Average: 10 4: Average and marginal product of labor Aa Aa Ernie\'s pizza restau

Question

Average: 10 4: Average and marginal product of labor Aa Aa Ernie's pizza restaurant uses a combination of workers and ovens to produce pizzas. The total number of pizzas produced per hour is given by the function q - 4K0.SLO.S, where K is the number of ovens and L is the number of workers. Although the two inputs are relatively substitutable, the number of ovens is fixed in the short run, and therefore Ernie is primarily interested in the marginal and average product of labor given his current number of ove (4). Complete the following table using the production function given. ovens (K) Workers (L) Pizzas per hour () /L MPL 11.31 13.86 5.66 4.62 Given Ernie's production function, he faces input is held constant, the marginal productivity of workers added. returns to scale. However, you can see that when one as more and more workers are workers to produce 32 pizzas per hour Still holding the number of ovens (K) fixed at 4, it would take

Explanation / Answer

Ovens (K) Workers (L) Pizzas per hour q/L MPL 4 1 8.00 8.00 4 2 11.31 5.66 3.31 4 3 13.86 4.62 2.54 4 4 16.00 4.00 2.14 MPL = (MPL)n -(MPL)n-1 Ernie faces decreasing returns to scale(MPL is decreasing). Marginal product of labor decreases.

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