You decide to buy a new car. You talk to friends about it, research mechanical specifications in Consumer Reports, test drive di
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Answer: Option (B) is correct.
Explanation:
Correct option: Decreasing marginal product.
Marginal product is the change in the level of output, when there will be an extra input employed in the production of a certain commodity.
So, Marginal Product =
Where,
Q = Output
I = Input
Marginal product of 1st bag = 500
Marginal product of 2nd bag = = 300
Marginal product of 3rd bag = = 100
∴ From the above calculations, we can seen that as we employed one more bag of seeds as a result marginal product goes on diminishing.
Hence, Joan's production function exhibits decreasing marginal product.