-Refer to the table above. When the________ worker is hired, the firm experiences increasing marginal returns of labor.

Question

Quizplus · Accepted Answer

Increasing marginal returns of labor occur when each additional worker contributes more to output than the previous one. This is typically observed when the number of workers is relatively low, allowing for better specialization or more efficient use of resources. In this case, without the specific table data, the general principle suggests that the 3rd worker is often at a point where firms start to experience increasing marginal returns due to more efficient division of labor and utilization of resources.

-Refer to the Table Above