4 Nimbus Ltd makes brooms and then sells them door-to-door. Here is the relationship between the number

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4 Nimbus Ltd makes brooms and then sells them door-to-door. Here is the relationship between the number of workers and Nimbus's output during a given day.

Workers Output Marginal Total cost Average Marginal product total cost cost a Fill in the column of marginal products. What pattern do you see? How might you explain it?

b A worker costs $100 a day and the firm has fixed costs of $200. Use this information to fill in the column for total cost.

c Fill in the column for average total cost. (Recall that ATC = TCIQ.) What pattern do you see?

d Now fill in the column for marginal cost. (Recall that MC = i::,.TC/1::,.Q.) What pattern do you see?

e Compare the column for marginal product with the column for marginal cost. Explain the relationship.

f Compare the column for average total cost with the column for marginal cost. Explain the relationship.

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Related Book For  book-img-for-question

Principles Of Microeconomics

ISBN: 125206

8th Edition

Authors: Joshua Gans, Stephen King, Martin Byford, N Gregory Mankiw

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