Question

tab Labor Total Product MP AP 12 21 31 40 48 54 57 57 54 17 6 9 7 7.75 10 6 7 6 7.71 7.12 6.33 54 3 10 -3 63. (Figure: Determining Marginal Returns) Referring to both the table and the figure, if a tenth worker is added, this leads to: A) increasing marginal returns. C) constant marginal returns. B) diminishing marginal returns. D) negative marginal returns. 64. The assumed goal of any firm is to: A) minimize cost. D) maximize profit. C) minimize taxes. B) maximize revenue. 65. Regarding the short-run cost model, the vertical distance between the ATC curve and the AVC curve is: D) TC. C) VC. B) AFC. A) MC. Reference: Ref 7-4 Total Product Labor 9 20 2 33 3 40 66. (Table) In the table, at what point does John's Salsa Company face diminishing marginal returns? B) when two people are hired D) when four people are hired A) when one person is hired C) when three people are hired 85 5*80e

Answer 1

Answer-63 The correct option is d.) Negative marginal returns.

Adding 10th worker reduces total output by 3 units.This leads to negative marginal returns.

Answer-64 The correct option is d.) Maximize profit.

It is assumed that goal of any firm is the maximization of Profit.

Answer-65 The correct option is b.) AFC

ATC = AVC + AFC

AFC = ATC - AVC.

Vertical distance between ATC and AVC represent AFC.

Answer-66 The correct option is D.) When four people are hired.

Labor. Total product Marginal product

1. 9. 9

2. 20. 11

3. 33. 13

4. 40. 7