Let's say that a firm has a fixed number of machines, and a fixed space within...
Let's say that a firm has a fixed number of machines, and a fixed space within which to work. As the firm hires workers to produce its output, it will observe that:
after a certain output, the additional output declines. However, there will always be increases as long as more workers are added.
after a certain output, the additional output increases. However, as more workers are added the additional output remains constant and the total output increases in proportionate increments.
there is a direct relationship between additional workers and additional output at all output levels
. after a certain output, the additional output declines. As more workers are added, it is possible that the total output declines as well.
none of the above.
Homework Answers
"C"
After a certain output, the additional output that the additional worker is producing will decline. However, it is even possible that the total output will decline as well. that will happen when the marginal productivity of that additional labor will be in negative.
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