Question

Number of law mowed per day Number of employees Figure 8.1 36) Refer to Figure 8.1. The marginal product of the second worker is A) 4 B) 5 0955 Lawn mowed D) 11 Number of Workers) Total Output Table 8.3 37) Refer to Table 8.3. If the firm hires even workers, then A) marginal product is less than one. B) marginal product is negative. total product is negative. D) marginal product is equal to three 38) Refer to Table 8.3. If four workers are hired, then A) marginal product equals five. B) total product is maximized on the table. C) diminishing marginal returns have started. D) all of the above 39) Which of the following statements about fixed costs is correct? A) Fixed costs are not opportunity costs. B) Fixed costs are always the largest portion of total costs. C) Fixed costs must be paid even if the firm's output is zero D) none of the above 40) 40) Dan owns a factory that manufactures smartphones. He has many expenses every month to keep his factory running. Which of the following is one of Dan's fixed costs? A) his electricity bill for the factory B) memory devices used to store music and video on the smartphones C) plastic used to make the smartphones D) his gortgage on the factory

Answer 1

36.) Refer to the figure 8.1. The marginal product of the second worker is 5 lawns mowed. [ as MP of the second worker is ( total product of two workers- total product of first worker) = (8-3) = 5]

37.) Refer to the figure 8.3. If the firm hires seven workers, then D. Marginal product is equal to three. [Here marginal product refers to the marginal product of the last worker,i.e, the 7th worker which has marginal product (60-57) = 3]

38.) Refer to the figure 8.3. If four workers are hired, then C. Diminishing marginal returns have started. [As. 4th worker has MP of (45-35) =10 and the 3rd worker has the MP of (35-20) = 15, so we can see that, MP starts decreasing, i.e, diminishing marginal returns have started.]

39.) C. Fixed costs must be paid even if the firm's output is zero. [Fixed costs are business costs, such as rent, that are constant whatever the amount of goods produced.]

40.) Dan owns a factory that manufactures smartphones. He has many expenses every month to keep his factory running. Which of the following is one of Dan's fixed costs? - D. His mortgage on his factory. [As this costs are constant whatever the amount of goods produced by Dan.]

Hope, it is cleared to you, my friend!!!