The marginal product of labor is likely to increase initially because when there are more workers, each is able to specialize on an aspect of the production process in which he or she is particularly skilled. For example, think of the typical fast food restaurant. If there is only one worker, he will need to prepare the burgers, fries, and sodas, as well as take the orders. Only so many customers can be served in an hour. With two or three workers, each is able to specialize and the marginal product (number of customers served per hour) is likely to increase as we move from one to two to three workers. Eventually, there will be enough workers and there will be no more gains from specialization. At this point, the marginal product will diminish.
ncreasing marginal returns mean that marginal product is greater for each subsequent unit of a variable input than it was for the previous unit. Decreasing marginal returns, as such, mean that marginal product is less for each subsequent unit of a variable input than it was for the previous unit.
the law of diminishing returns states that as a set of variable factors is added to a set of fixed factor, the marginal product and average product will first increase then eventually decrease
Diminishing marginal product of capital is an economic principle that refers to the concept that when the input is increased and the other inputs are kept at the same level than it may initially increase output. However, if the inputs continue to increase with no other changes there may be limited effect or eventually negative effect on the output.
Marginal Variable Product (MVP) = Difference between TVP2 - TVP1
Marginal Product
ncreasing marginal returns mean that marginal product is greater for each subsequent unit of a variable input than it was for the previous unit. Decreasing marginal returns, as such, mean that marginal product is less for each subsequent unit of a variable input than it was for the previous unit.
Marginal product is any input in the production process is the increase in the quantity of output obtained from on additional unit of the input. Average product is the output produced when one more unit of the variable factor is employed The relationship is state as: If labour's marginal product is exceed its average product that means labour's average product will be rising. Labour's average product will be falling. If labour's marginal product is less than its average product. If labour's marginal product is equal its average product and the average product will reach the minimum value at the point.
The marginal product curve is 'n' shaped because of the law of diminishing returns. As you add more units of a variable factor, at first, the marginal product rises, (this is because the fixed factor is under-utilised, so adding more units of the variable factor will increase the output from each additional unit). But after a certain point, the marginal product begins to fall, as the fixed factor input becomes diluted amongst workers and so you get less from each additional unit of the variable factor. For an example, re-read the above paragraph and replace the word variable factor with labour and fixed factor with capital. The marginal cost curve is the inverse of the marginal product curve - hence it is shaped like a 'u' or a 'Nike tick'. This is because if your marginal product is high - then your marginal costs are low. For example, if a firm must pay electricity for the time it takes to produce a unit, if the firm can produce the unit quicker (i.e. has a high marginal product) then the cost of electricity will be lower. Hence the inverse relationship between marginal cost and marginal product.
the law of diminishing returns states that as a set of variable factors is added to a set of fixed factor, the marginal product and average product will first increase then eventually decrease
Diminishing marginal product of capital is an economic principle that refers to the concept that when the input is increased and the other inputs are kept at the same level than it may initially increase output. However, if the inputs continue to increase with no other changes there may be limited effect or eventually negative effect on the output.
Marginal Variable Product (MVP) = Difference between TVP2 - TVP1
Marginal Product
The law of diminishing marginal product states that as a firm uses more of a variable resource with a fixed resource and fixed technology, the marginal product of the variable resource will fall. From related site.
marginal product of labor
I think..... In marginal costing method only variable cost is considered as product cost and fixed cost is not considered as product cost. But in reality product cost include fixed and variable, thus both variable and fixed costs should be considered while allocating cost. Marginal costing is used for inside reporting and absorption costing is used for outsider to clarify the real cost of product........ Am i right? Please confirm it
Total utility is the overall utility achieved by using any product while marginal utility is the increase/decrease in utility from use of one more unit of product.
Negative