Table 5.2
-Refer to Table 5.2, which gives a firm's production function. Assume that all non-labor inputs are fixed. The marginal product is maximized when the firm hires
A) 2 workers.
B) 3 workers.
C) 4 workers.
D) 5 workers.

Question

Table 5.2
-Refer to Table 5.2, which gives a firm's production function. Assume that all non-labor inputs are fixed. The 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 is maximized at the point where the additional output from hiring one more worker is the greatest. This typically occurs before diminishing returns set in. Based on the production function, this is at 3 workers.

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