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Suppose that a firm is producing in the short run when machine number is fixed. It knows that as the number of workers used in

  1. Suppose that a firm is producing in the short run when machine number is fixed. It knows that as the number of workers used in the production process increases, the number of output changes according to the following table:

    1. # of workers

      # of output

      0

      0

      1

      10

      2

      17

      3

      22

      # of workers

      # of output

      4

      25

      5

      26

      6

      25

      7

      23

      1. Calculate the marginal and average products of labor for each additional worker. You can create a new table by adding two more columns for MPL and APL.

    2. Does this production function exhibit diminishing returns to labor? Explain.

    3. Explain intuitively what might cause the marginal product of labor to become negative.

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