On a 100-acre farm, a farmer is able to produce 3,000 bushels of wheat when he hires 2 workers. He is able to produce 4,400 bushels of wheat when he hires 3 workers. Which of the following possibilities is consistent with the property of diminishing marginal product?
A)The farmer is able to produce 5,600 bushels of wheat when he hires 4 workers.
B)The farmer is able to produce 5,400 bushels of wheat when he hires 4 workers.
C)The farmer is able to produce 5,200 bushels of wheat when he hires 4 workers.
D)Any of the above could be correct.

Question

Quizplus · Accepted Answer

The property of diminishing marginal product states that as more workers are added to a production process, the additional output produced by each additional worker will eventually decrease. In this case, the farmer is able to produce 3,000 bushels of wheat with 2 workers and 4,400 bushels of wheat with 3 workers. This means that the marginal product of the third worker is 4,400 - 3,000 = 1,400 bushels. If the property of diminishing marginal product holds, then the marginal product of the fourth worker will be less than 1,400 bushels. Therefore, the farmer is able to produce less than 5,600 bushels of wheat when he hires 4 workers.

On a 100-Acre Farm, a Farmer Is Able to Produce