Question

Complete this assignment by filling in the table and answering each question in the document below. This assignment will be graded out of 10 points with 2 points possible for each question.

1) Use the chart below to calculate marginal product.

Labor Input	Total Product	Marginal Product
0	0
1	10
2	26
3	48
4	71
5	86
6	96
7	95
8	90

2) Use the chart above to determine the labor input when diminishing returns to an input sets in. Explain your answer.

3) Use the chart above to determine the labor input when negative returns to an input sets in. Explain your answer.

4) In which time horizon, the long run or the short run can a firm adjust the quantity of any input type?

5) What is the difference between total product and marginal product?

Answer 1

1)

Labor Input	Total Product	Marginal Product
0	0
1	10	10
2	26	16
3	48	22
4	71	23
5	86	15
6	96	10
7	95	-1
8	90	-5

Marginal product (nth unit) = Total product (n units) - Total product ((n-1) units)

2)

Diminishing returns to an input sets in when labour input = 5 (Marginal product begins to decrease, i.e. additional unit of labour produces less output in comparison to the previous unit of labour)

3)

Negative returns to an input sets in when labour input = 7 (Marginal product turns negative)

4)

Variable inputs (e.g. labour) can be adjusted in the short run where as Fixed inputs (e.g. capital) can only be adjusted in the long run and not in the short run.

5)

Total product is the total quantity produced by employing 'n' variable inputs where as marginal product is the additional quantity produced by the nth unit of variable input.