H13ProductionAndCosts

H13ProductionAndCosts - Time Frames 47 short run - at least...

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1 Time Frames Time Frames short run - at least one input is fixed does not vary with output must be “used” long run - all inputs variable increases with output is not used if no output is produced 47 Production Function Production Function production function maximum output produced as a function of inputs, all else constant Factor Total Product Average Product Marginal Product 00 - 2 40.0 20.0 4 68.0 17.0 6 88.0 14.7 8 103.0 12.9 10 115.0 11.5 12 125.0 10.4 14 134.0 9.6 16 142.0 8.9 18 149.0 8.3 20 155.0 7.8 20.0 14.0 10.0 7.5 6.0 5.0 4.5 4.0 3.5 3.0 0 40 80 120 160 200 0 2 4 6 8 10 12 14 16 18 20 Total Product TP 47 Average Product output per unit of input AP X = Q/x Marginal Product additional output from an additional unit of input, all else held constant MP X = Q/ x Productivity Factor Total Product Average Product Marginal Product 0 0 - 2 40.0 20.0 4 68.0 17.0 6 88.0 14.7 8 103.0 12.9 10 115.0 11.5 12 125.0 10.4 14 134.0 9.6 16 142.0 8.9 18 149.0 8.3 20 155.0 7.8 20.0 14.0 10.0 7.5 6.0 5.0 4.5 4.0 3.5 3.0 xQ Q / x Q/ x law of diminishing returns additional output from successive increases of one input will eventually diminish (other inputs held constant) 47
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2 Factor Total Product Average Product Marginal Product 00 - 2 40.0 20.0 4 68.0 17.0 6 88.0 14.7 8 103.0 12.9 10 115.0 11.5 12 125.0 10.4 14 134.0 9.6 16 142.0 8.9 18 149.0 8.3 20 155.0 7.8 20.0 14.0 10.0 7.5 6.0 5.0 4.5 4.0 3.5 3.0 Productivity Productivity xQ Q / x Q/ x 0 40 80 120 160 200 024681 0 1 2 1 4 1 6 1 8 2 0 Total Product TP 0 5 10 15 20 25 0 2 4 6 8 10 12 14 16 18 20 Factor Product MP X AP X 47 Factor Total Product
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H13ProductionAndCosts - Time Frames 47 short run - at least...

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