Table 5.1
-Refer to Table 5.1, which gives a firm's production function. Assume that all non-labor inputs are fixed. Marginal product is maximized when the firm hires
A) 2 workers.
B) 3 workers.
C) 4 workers.
D) 5 workers.

Question

Table 5.1
-Refer to Table 5.1, which gives a firm's production function. Assume that all non-labor inputs are fixed. Marginal product is maximized when the firm hires
A) 2 workers. 
B) 3 workers. 
C) 4 workers. 
D) 5 workers.

Quizplus · Accepted Answer

The marginal product of labor is maximized when the additional output from hiring one more worker is at its highest point before it starts to decline. This typically occurs before the point of diminishing marginal returns sets in. Without the specific data from Table 5.1, the general principle is that the marginal product is maximized at the point where adding one more worker leads to the highest increase in output. Given the choices, and assuming the question implies that with 2 workers the marginal product is at its peak, the correct answer would be when the firm hires 2 workers.

Table 5.1 -Refer to Table 5.1, Which Gives a Firm's Production Function