1. My friend, Mike, is a CPA and owns his own tax business. During tax season, he hires additional workers.Would you expect Mike's office to experience diminishing marginal product of labor? Would you expect diminishing marginal product of capital? Why or why not?

1. When computers were first introduced in production, what affect do you think they had on labor productivity? Explain and illustrate this effect on the long-run equilibrium levels of output and the price level.

1. Members of Congress are interested in increasing the minimum wage from its current rate of $7.25 an hour to $15. What affect will this have on the unemployment rate for low skilled workers? How is this likely to impact equilibrium output and the price level in the short run?