Question

If in the short run a firm's marginal product is positive, then: o the firm must be operating either in stage 1 or stage 2 of its production function. O its total product must be increasing. O its total product may be increasing or decreasing. O its average product must be increasing. Question 9 2.5 pts Suppose K and L are perfect complements in a production function. Then the isoquants will be O a straight line shaped like letter L O convex O a ray passing through the origin

Answer 1

Q1) Correct option - the firm must be opterating either in stage 1 or stage 2 of it's production function.

In stage 1 - marginal product is increasing at increasing rate therefore marginal product is positive.

Stage 2 - marginal product is increasing at decreasing rate but still it is positive.

Q2) correct option - shaped like letter L

When the production isoquants are L-shaped, only one combination of labour (L) and capital (K) can be used to produce a given output. The addition of more labour does not increase output, nor does the addition of more capital alone.