What Is the difference between technology and technological change? Sally quit h

Question

What Is the difference between technology and technological change? Sally quit her job as an auto mechanic earning $50, 000 per year to start her own business. To save money she operates her business out of a small building she owns which, until she started her own business, she had rented out for $10, 000 per year. She also invested her $20, 000 savings (which earned a market interest rate of 5% per year) in her business. You are given the following information about the first year of her operations. a. Calculate her explicit costs. b. Calculate her implicit costs. The table above shows the technology of production at the Matsudos Mushroom Farm for the month of May. a. What is the marginal product of the 4th worker? b. What is the average product of labor when the farm hires 5 workers? c. Diminishing marginal returns sets in when the worker is hired.

Explanation / Answer

1.

Technology refers to the methodology or technique to use for producing product and services. But, technological changes refer to the shift from one technology to another technology to improve productivity and / or the overall process. Technological changes take place over a period of time. Though, a technology is used in present scenario.

For example, use of poly pack machine in packaging is the example of technology. But, a shift from manual operation to PLC (Programmable Logical Control) based automated operation is the example of technological change.

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