100%(1)1 out of 1 people found this document helpful
This preview shows page 1 - 3 out of 4 pages.
Business EconomicsASSIGNMENT - 2Sunil ShettyPERMANENT REGISTRATION NUMBER: 170101611115
1.You are an employer seeking to fill a vacant position on an assemblyline. Are you more concerned with the average product of labor or themarginal product of labor for the last person hired? If you observe thatyour average product is just beginning to decline, should you hire anymore workers? What does this situation imply about the marginalproduct of your last worker hired? Discuss the three stages ofproduction function with an example. Which stage will be preferred byyou as rational firm? Why?Ans: In filling an empty position, you ought to be worried about the minimal resultof the last laborer enlisted, in light of the fact that the peripheral item measures the impact on yield, or aggregate item, of procuring another specialist. This thus decides the extra income produced by enlisting another specialist, which should then be contrasted with the cost of procuring the extra laborer. The time when the normal item starts to decrease is the point where normal item is equivalent to minor item. As more specialists are utilized past this point, both normal item and minimal item decrease. In any case, peripheral item is as yet positive, so add up to item keeps on expanding. Subsequently, it might in any case be gainful to employ another specialist.