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The output from a pottery, Q, is related to the number of labour units employed according to the production function Q = 912 - 0.123
The output from a pottery, Q, is related to the number of labour units employed according to the production function Q = 912 - 0.123 where L is the number of labour units employed. Part A Write down the equations of the marginal product of labour MP, and average product of labour AP, and explain the significance of MP, and AP, in this context at L = 2. Sketch appropriate graphs of MP, and AP,, and deduce the relationship between these two functions. In particular, you need to prove that the marginal product of labour is equal to the average product of labour when the latter is at a maximum. Part B Sketch the graph of the productivity labelling its turning points and inflection points. Use this and the previous graphs to describe the relationship between productivity and marginal product of labour. Is there any relationship between the turning points and points of inflection in the graphs plotted? Part C From the analysis made you need now to write a short conclusion to support the pottery in increasing their production in terms of the number of labour units employed
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