Question

Har Har Company makes hats using the technology described in the following data: With Three Machines With Four Machines Martin Total Product Total Product Marginal Produce (hats Labor Labor Thats) Product thats) I day 2 days 3 days 4 days 55 3 days 6 days 88 7 days 95 20 the Marginal Product columns of these tables what point does diminishing marginal product set in with three machines with four why the point of diminishing marginal product different in each case

only b and c needed please .

Answer 1

(a) With three machines:

L	TP	MP=Change in TP
1	8	-
2	18	10
3	30	12
4	45	15
5	57	12
6	67	10
7	72	5

With four machines:

L	TP	MP= Change in TP
1	9	-
2	20	11
3	35	15
4	55	20
5	76	21
6	88	12
7	95	7

(b) The point of diminishing marginal product is at 5 workers days with three machines and 6 workers days with four machines.

(c) The point of diminishing marginal product different in each case because crowding occurs later with more machines , the more the capital input is , the more it takes time for diminishing marginal product to occur.