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The table below represents the production function for a coffeehouse in Rochester. The number in the cells represent the number of customers that can be
The table below represents the production function for a coffeehouse in Rochester. The number in the cells represent the number of customers that can be served daily with venous amounts of capital and labor. LaboriL) 1 100 132 155 1T5 190 205 2 152 200 235 264 289 310 Capat g 3 193 255 300 33? 368 396 4 230 303 35? 400 437 470 5 263 34? 408 45? 500 538 6 293 38? 455 510 558 600 Notice that the marginal product of a fth worker when firm is using 1 unit of capital is less than the marginal product of a fth worker if the rm is using 6 units of capital. Based on this. does this production function violate the law of diminishing marginal product at labor? @ It does not violate the law ofdiminishing MP 0! la bor because in the above example. we are holding labor fixed. {:3- It does violate the law of diminishing MP of labor because the above example is of a shortrun production function. .;:_j;- It does not violate the law o'fdiminishing MP of la bor because the above example is of a short-run production function. {:3- It does not violate the law of diminishing MP 0! la bor because in the above example. we are not holding capital xed
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