Question #63616
2. Here is the relationship between the number of worker-hours (L) and the number of apples produced (Q):
L Q
0 0
1 10
2 20
3 29
4 37
5 44
6 50
7 55
8 59
9 62
10 64
Assume wage is $10 per hour, and Total Fixed Cost is $20.
For each value of L (from 0 to 10), make a table showing: Marginal Product of Labour; Total Cost; Average Total cost; Marginal Cost. (Like Question 5 page 293 Nimbus Brooms). Explain why there is a relationship between Marginal Product and Marginal Cost.
L Q
0 0
1 10
2 20
3 29
4 37
5 44
6 50
7 55
8 59
9 62
10 64
Assume wage is $10 per hour, and Total Fixed Cost is $20.
For each value of L (from 0 to 10), make a table showing: Marginal Product of Labour; Total Cost; Average Total cost; Marginal Cost. (Like Question 5 page 293 Nimbus Brooms). Explain why there is a relationship between Marginal Product and Marginal Cost.
Expert's answer
Answer on Question #63616, Economics / Microeconomics
MPL = ΔQ/ΔL, TC = FC + w*L, ATC = TC/Q, MC = ΔTC/ΔQ.
Marginal cost represents the total cost to produce one additional unit of product or output. Marginal product is the extra output generated by one additional unit of input, such as an additional worker. Marginal cost and marginal product are inversely related to one another: as one increases, the other
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will automatically decrease proportionally and vice versa.
