Jeff Owns a Garage and Has 3 Mechanics to Help

question 44

Multiple Choice

Jeff owns a garage and has 3 mechanics to help him.With the tools used being fixed in the short run, his production function is given by 5 + 2L = Y , where L is the number of mechanics and Y is the number of cars they can fix.If Jeff hires a fourth mechanic, what will be the marginal product of the new mechanic hired?

• A)11
• B)13
• C)2
• D)7

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Definitions:

Transfer Payments

are non-exchange transactions where one party (usually the government) provides economic benefits to another without receiving a good or service in return.

Domestic Output

Refers to the total value of all goods and services produced within a country's borders in a given time period, usually measured as GDP.

Tax Revenue

The revenue collected by governments via taxes.

Personal Income Taxes

These are taxes levied on individuals or households based on their total income from various sources, after allowances for deductions and credits.