Nimbus, Inc., makes brooms and then sells themdoor-to-door. Here is the relationship between thenumber of workers and Nimbus’s output during agiven day:Workers OutputMarginalProductTotalCostAverageTotalCostMarginalCost0 0 ____ ________ ____1 20 ____ ________ ____2 50 ____ ________ ____3 90 ____ ________ ____4 120 ____ ________ ____5 140 ____ ________ ____6 150 ____ ________ ____7 155 ____ ____a. Fill in the column of marginal products. Whatpattern do you see? How might you explain it?b. A worker costs $100 a day, and the firm has fixedcosts of $200. Use this information to fill in thecolumn for total cost.c. Fill in the column for average total cost. (Recallthat ATC T 5 C Q/ .) What pattern do you see?d. Now fill in the column for marginal cost.(Recall that MC TC 5 D ∆ / Q.) What patterndo you see?e. Compare the column for marginal productwith the column for marginal cost. Explain therelationship.f. Compare the column for average total costwith the column for marginal cost. Explain therelationship.
Nimbus, Inc., makes brooms and then sells them
door-to-door. Here is the relationship between the
number of workers and Nimbus’s output during a
given day:
Workers Output
Marginal
Product
Total
Cost
Total
Cost
Marginal
Cost
0 0 ____ ____
____ ____
1 20 ____ ____
____ ____
2 50 ____ ____
____ ____
3 90 ____ ____
____ ____
4 120 ____ ____
____ ____
5 140 ____ ____
____ ____
6 150 ____ ____
____ ____
7 155 ____ ____
a. Fill in the column of marginal products. What
pattern do you see? How might you explain it?
b. A worker costs $100 a day, and the firm has fixed
costs of $200. Use this information to fill in the
column for total cost.
c. Fill in the column for average total cost. (Recall
that ATC T 5 C Q/ .) What pattern do you see?
d. Now fill in the column for marginal cost.
(Recall that MC TC 5 D ∆ / Q.) What pattern
do you see?
e. Compare the column for marginal product
with the column for marginal cost. Explain the
relationship.
f. Compare the column for average total cost
with the column for marginal cost. Explain the
relationship.
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