You Have Been Hired by the Tootsie Roll Company to Analyze

question 15

Essay

You have been hired by the Tootsie Roll Company to analyze their production process.Your predecessor in the position left you with the following table: $$\begin{array} { | c | c | l | c | } \hline \text { Number of Workers } & \begin{array} { c } \text { Total Output } \\\text { (thousands of bags of } \\\text { Tootsie Rolls) }\end{array} & \text { Marginal Product } & \begin{array} { c } \text { Average } \\\text { Product }\end{array} \\\hline 0 & 0 & & \\\hline 1 & 4 & & \\\hline 2 & 10 & & \\\hline 3 & 17 & & \\\hline 4 & 23 & & \\\hline 5 & 28 & & \\\hline 6 & 31 & & \\\hline 7 & 32 & & \\\hline 8 & 32 & & \\\hline 9 & 30 & & \\\hline 10 & 25 & & \\\hline\end{array}$$ (NOTE: Marginal product represents changes between numbers of workers.Therefore,leave the first row blank in the "Marginal Product" column and put the marginal product from 0 workers to 1 worker in the second row of that column. )
(a)Fill in the blank values in the table above.
(b)Do the values in the table represent short-run or long-run production relationships? Explain.
(c)Are these production values consistent with the law of diminishing marginal productivity? Explain.
(Extra Credit: Between what levels of output is the firm most likely to operate? Explain your answer. )

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Definitions:

Point

A precise location or position in a two-dimensional or three-dimensional space, usually represented by a dot.

Access Ramp

A sloped surface designed to allow people with disabilities to enter or exit buildings.

Horizontally

In a direction parallel to the horizon or to the x-axis in a plane coordinate system.

Horizontal Distance

Horizontal distance is the measure of length between two points along a straight line that runs parallel to the x-axis in a coordinate plane.