Scenario 13-18
Farmer Jack is a watermelon farmer. If Jack plants no seeds on his farm, he gets no harvest. If he plants 1 bag of seeds, he gets 30 watermelons. If he plants 2 bags of seeds, he gets 50 watermelons. If he plants 3 bags of seeds he gets 60 watermelons. A bag of seeds costs $100, and the costs of seeds are his only costs.
-Refer to Scenario 13-18. Which of the following statements is (are) true? (i)
Farmer Jack experiences decreasing marginal product.
(ii)
Farmer Jack's production function is nonlinear.
(iii)
Farmer Jack's total cost curve is linear.

Question

Quizplus · Accepted Answer

(i) is true because as the number of bags of seeds increases, the additional output (number of watermelons) increases at a decreasing rate.
(ii) is true because the production function is not a straight line and shows increasing returns to scale up to a certain point, then diminishing returns.
(iii) is false because the total cost curve is not linear as the cost of seeds increases with the number of bags planted.

Scenario 13-18 Farmer Jack Is a Watermelon Farmer. If Jack Plants No