Table 5.2
-Refer to Table 5.2, which gives a firm's production function. Assume that all non-labor inputs are fixed. Diminishing returns set in with the addition of the
A) third worker.
B) fourth worker.
C) fifth worker.
D) sixth worker.

Question

Table 5.2
-Refer to Table 5.2, which gives a firm's production function. Assume that all non-labor inputs are fixed. Diminishing returns set in with the addition of the
A) third worker. 
B) fourth worker. 
C) fifth worker. 
D) sixth worker.

Quizplus · Accepted Answer

Diminishing returns to labor occur when adding an additional unit of labor (worker) results in a smaller increase in output than the previous unit of labor added. Without the specific data from Table 5.2, the general principle is that if the increase in output decreases with the addition of the fourth worker, this indicates the point at which diminishing returns have set in.

Table 5.2 -Refer to Table 5.2, Which Gives a Firm's Production Function