Test 4-production function

Question 1

when capital is ________ but labor ________, the only way the firm can produce more output is by…

Answer 1

fixed
variable
increasing its labor input

Question 2

Marginal product

Answer 2

the increase in output produced that arises when an additional unit of input (FOP) is added.

Question 3

Diminishing Marginal Product

Answer 3

the property whereby the marginal product of input declines as the number of input increases.

the property whereby the production output declines as the number of input increases.

Question 4

as labor (workers) increase your marginal product starts to

Answer 4

decrease

Question 5

cost of factory

Answer 5

a fixed cost
remains constant (same)

Question 6

cost of workers

Answer 6

a variable cost
as workers increase, the cost also increases

Question 7

how do you calculate your marginal product of labor?

Answer 7

go to your output column & minus your 2nd answer from your 1st answer.