Refer to Scenario 7

question 105

Multiple Choice

Refer to Scenario 7.4 below to answer the questions that follow.
SCENARIO 7.4: A lawn service company has the following production possibilities. With one, two, three, and four workers, the company can mow 4, 9, 12, and 14 lawns per day, respectively.
-Refer to Scenario 7.4. The marginal product of the third worker is

• A) 2
• B) 3
• C) 4
• D) 12

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Definitions:

Industry Demand Curve

A graph showing the relationship between the price of a good and the total amount of the good all consumers are willing to purchase within a specific industry.

Welfare or Efficiency Loss

The decrease in economic efficiency, often measured as the loss of consumer or producer surplus, due to deviations from perfect competition.

Marginal Revenue

The additional income gained from selling one more unit of a good or service; crucial for determining the optimum level of production.

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output typically decreasing with increasing scale.