Question

Suppose that a college physics experiment goes horribly wrong and releases an electronic pulse that renders all electronic equipment in the city of san francisco permanently useless. no people are hurt, and no buildings are damaged. after the accident, the wages earned by california workers will _____ because the marginal productivities of workers will _____.

Answer 1

It will decrease because the marginal productivities of workers will decrease.  Diminishing marginal product occurs when the marginal product of an input goes down as the quantity of the input goes up.  The transformation in product resulting from employing one more unit of a particular input for instance, the change in output when a firm's labor is mark up from five to six units, assuming that the mass of other product are kept constant  is called The input of marginal product or marginal physical product.