A firm's total product of labor curve is represented by the following data: 1 worker can produce 4 units of output; 2 workers, 10 units; 3 workers, 17 units; 4 workers, 25 units; 5 workers, 30 units; 6 workers, 35 units; 7 workers, 38 units; 8 workers,
39 units; and 9 workers, 38 units. What is the marginal product of the seventh worker? When does the law of diminishing marginal product set in? Under these circumstances would you ever choose to employ nine workers?
The marginal product of the seventh worker equals three units of output. The marginal product begins to diminish when the fifth worker is hired. One would never choose to employ nine workers since the marginal product of the ninth worker is negative.
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Fixed costs plus variable costs:
a. increasing marginal returns b. total cost c. marginal revenue d. marginal product of labor e. marginal cost
Is it possible for a firm to have a comparative advantage in producing something without having an absolute advantage? Why or why not?
What will be an ideal response?