Question

Homework 2 Question 2. Michael needs to decide how many hours he should study during each week for a given class. If Michael does not study at all he gets and F (GPA 0.00). If he studies 1 hour per weelk

Answer 1

Increasing marginal returns: Any increase in a marginal output due to increase in variable input by making fixed input constant is called increase in marginal returns.

Diminishing marginal returns: Any decrease in marginal output at a point due to an additional increase in single factor of production is called diminishing marginal returns.

In the above scenario any increase in number of hours per week that Michael study for the given class is making him to get a better grade. So if Michael is studying more number of hours in a week he will get that much better grade in that class which means there is an increase in the marks that he will get in that class. Thus it is an increasing marginal return as his output is increasing with additional input.