The following table shows the relationship between workers and output for a small factory in the short run, with capital held constant Find the marginal product of labor (MP) Workers Output MP 40 2 88 3 141 4 183 5 201 OOODD
The following table shows the relationship between workers and output for a small factory in the short run, with capital held constant Find the marginal product of labor (MP) Workers Output MP 40 2 88 3 141 4 183 5 201 OOODD
Chapter6: Proudction Costs
Section: Chapter Questions
Problem 2SQ
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Transcribed Image Text:The following table shows the relationship between workers and output for a small factory in the short run, with capital held constant. Find the marginal product of
labor (MP).
Workers
Output
MP.
1
40
2
88
3
141
4.
183
201
Expert Solution
Step 1
The marginal product of labour (or MPL) alludes to an organization's expansion in absolute production level when one extra unit of labour is included and any remaining elements of production stay steady. At the end of the day, the MPL is the extra yield/output an organization encounters after recruiting another laborer. It is typically a positive number during early recruiting of labourers, yet doesn't ordinarily show steady returns—the MPL will consistently start to moderate as the quantity of workers increments, and they, thus, should start sharing assets like gear during the production cycle.
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