Question

Fill in the following blanks

                        L          Q                     MP                  AP

                        =============================

                        0          0                    --                      --

                        1          10                   

                        2          42                    ___                  ___

                        3          62                                            ___

                        4          63                    ___

                       

2. From the table above, at which worker hired do diminishing marginal returns begin?       

Answer 1

Q1

AP=TP/Q
MP(n)=(TP(n)-TP(p))/(n-p)
MP(n)=marginal product of n th unit of input
TP(n)= total product of n inputs
TP(p)=total product of p inputs
it is true for n>p
MP(1)=(10-0)/(1-0)=10

MP(2)=(42-10)/(2-1)=32 and so on

AP(1)=10/1=10

AP(2)=42/2=21

and so on

L	Q	MP	AP
0	0
1	10	10	10
2	42	32	16
3	62	20	6.67
4	63	1	0.25

Q2

The marginal product decreases as the 3rd worker is employed so at 3rd worker hired do diminishing marginal returns begin.