Diminishing Marginal Productivity: Strong Connection between Marginal Cost and Marginal Product
Hi Jacqueline, Professor and class
You were able to deliver a great post easy to comprehend. Regarding the topic this week, you’ve mentioned the fact that the number of goods that a firm is manufacturing is in direct connection with the marginal product. Sometimes, less is more and less employees using the right equipment and technologies are able to perform much efficient that a greater number of employees that are using old tools in their activity. .
As you well said, marginal cost and marginal product are strongly connected. When the value of the marginal cost is dropping, the value of the marginal product is raising and vice-versa. The quantity of the inputs can’t be changed at one time so managers tend to keep some of the inputs at a constant level. As every manager is looking to earn and increase profit, it is very important to calculate and determine the level at which the rate of profit is going to reach a maximum value. (www.ag.ndsu.edu).
Considering that you’re working as a manager and get across a negative value for the marginal product of labor, what would you consider the cause might be?
References
Diminishing Marginal Productivity — NDSU. (n.d). NDSU Agriculture — NDSU. Retrieved September 22, 2013, from http://www.ag.ndsu.edu/aglawandmanage
Hi Lisset, Professor and class
Thanks a lot for your feedback. You were able to take a great conclusion to my paperwork by reminding the fact that a manager should take his time and analyze very well the impact that a new addition would have on the long run for the business’ productivity.
As a manager you always have to be ready for change and come up with a solution that can maintain and why not increase productivity. Researching the web, I’ve came across Golden (n.d) that’s talking about the Marginal Decision Rule. This rule is using the marginal cost value of the product to determine if the production can be increased. If the price is lower than the marginal cross, an expansion of the
You were able to deliver a great post easy to comprehend. Regarding the topic this week, you’ve mentioned the fact that the number of goods that a firm is manufacturing is in direct connection with the marginal product. Sometimes, less is more and less employees using the right equipment and technologies are able to perform much efficient that a greater number of employees that are using old tools in their activity. .
As you well said, marginal cost and marginal product are strongly connected. When the value of the marginal cost is dropping, the value of the marginal product is raising and vice-versa. The quantity of the inputs can’t be changed at one time so managers tend to keep some of the inputs at a constant level. As every manager is looking to earn and increase profit, it is very important to calculate and determine the level at which the rate of profit is going to reach a maximum value. (www.ag.ndsu.edu).
Considering that you’re working as a manager and get across a negative value for the marginal product of labor, what would you consider the cause might be?
References
Diminishing Marginal Productivity — NDSU. (n.d). NDSU Agriculture — NDSU. Retrieved September 22, 2013, from http://www.ag.ndsu.edu/aglawandmanage
Hi Lisset, Professor and class
Thanks a lot for your feedback. You were able to take a great conclusion to my paperwork by reminding the fact that a manager should take his time and analyze very well the impact that a new addition would have on the long run for the business’ productivity.
As a manager you always have to be ready for change and come up with a solution that can maintain and why not increase productivity. Researching the web, I’ve came across Golden (n.d) that’s talking about the Marginal Decision Rule. This rule is using the marginal cost value of the product to determine if the production can be increased. If the price is lower than the marginal cross, an expansion of the
References: Sherman, F. (n.d.). Importance of Marginal Costs and Benefits | Chron.com.Small Business – Chron.com. Retrieved September 22, 2013, from http://smallbusiness.chron.com/importance-marginal-costs-benefits-46506.html