Marty's Frozen Yogurt is a small shop that sells cups of frozen yogurt in a university town. Marty owns three frozen-yogurt machines. His other inputs are refrigerators, frozen-yogurt mix, cups, sprinkle toppings, and, of course, workers. He estimates that his daily production function when he varies the number of workers employed (and at the same time, of course, yogurt mix, cups, and so on) is as shown in the accompanying table.
Quantity of labor Quantity of frozen
(workers) yogurt (cups)
0………………………………….. 0
1………………………………….. 110
2………………………………….. 200
3………………………………….. 270
4………………………………….. 300
5………………………………….. 320
6………………………………….. 330
a. What are the fixed inputs and variable inputs in the production of cups of frozen yogurt?
b. Draw the total product curve. Put the quantity of labor on the horizontal axis and the quantity of frozen yogurt on the vertical axis.
c. What is the marginal product of the first worker? The second worker? The third worker? Why does marginal product decline as the number of workers increases?