Consider a Basket-Producing Firm with Fixed Capital

question 65

Multiple Choice

Consider a basket-producing firm with fixed capital.If the firm can produce 36 baskets per day with 3 workers and then increases productivity to 44 baskets per day with 4 workers,then which of the following statements is true?

• A)The marginal product of the fourth worker is 11.
• B)The firm has passed the point of diminishing average productivity.
• C)The marginal product is above the average product.
• D)The firm has not yet reached the point of diminishing marginal productivity.
• E)With 4 workers,the firm's average product of labour is 13.

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Definitions:

Interdependent

A mutual dependence between things or people, where each is reliant on the other for certain demands or needs.

Previous Stages

The earlier phases or periods in a sequence of events or processes, often referring to development.

Autonomy versus Shame

A stage in Erikson's psychosocial development theory where, during toddlerhood, children develop a sense of personal control and independence, or experience doubt and shame.

Muscular-anal Stage

In psychoanalytic theory, a developmental phase focusing on toilet training where children learn to exert control over bodily functions.