Question

Seth is trying to decide how many workers is the optimal amount at his factory, which produces artisan-crafted grooming products. He observes the following:

When there is one worker, 10 hairbrushes are produced daily.
When there are two workers, 16 hairbrushes are produced daily.
When there are three workers, 20 hairbrushes are produced daily.
What is the marginal product of the third worker?

Answer 1

Marginal product of the third labor unit = 4 hairbrushes

Step-by-step explanation:

Marginal product of each additional labor unit can be calculated by dividing the total change in output of employing an additional unit by the change in labor.

Change in production after employing 3rd labor unit = 20-16 = 4

Marginal product = Change in out put / Change in labor

Marginal Product = 4 / 1 = 4 units

So the marginal product of the third labor unit = 4 hairbrushes.

Hope that helps.