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Chapter 7: Q 14. (page 184)

How do we calculate marginal product?

Short Answer

Expert verified

The marginal product (MP) is calculated by dividing the change in the total product by the change in the amount of the input (labor).

Step by step solution

01

Step 1. Marginal product 

Marginal product is the amount of product obtained by employing an additional unit of input (say labor).

02

Step 2. Calculation of marginal product

The marginal product (MP) can be obtained by dividing the change in the total product by the change in the amount of the input (labor). Algebraically,

MP=∆TP∆L

Where, TP = total product, L = labor,∆= change.

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Most popular questions from this chapter

How does Fixed Cost effect Marginal Cost ? Why is this relationship important ?

What shapes would you generally expect each of the following cost curves to have: fixed costs, variable costs, marginal costs, average total costs, and average

variable costs?

Continuing from Exercise 7.1, the firm’s factory sits on land owned by the firm that it could rent for$30,000per year. What was the firm’s economic profit last year?

Average cost curves (except for average fixed cost) tend to be U-shaped, decreasing and then increasing. Marginal cost curves have the same shape, though this may be harder to see since most of the marginal cost curve is increasing. Why do you think that average and marginal cost curves have the same general shape?

What is a long-run average cost curve?
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