The relationship between labor usage and output at the local coffee shop is summarized in the table below.The price of a cup of espresso is $1.25 and no other inputs are required. $$\begin{array} { c c }
\begin{array} { c c }
\text { Labor } \
\underline { \text { Input }}
\end{array} & \begin{array} { c }
\text { Cups of } \
\underline { \text { espresso }}
\end{array} \
0 & 0 \
1 & 25 \
2 & 45 \
3 & 60 \
4 & 70 \
5 & 75
\end{array}$$
The marginal product of the third worker is __________ than the marginal product of the second worker which means __________.

Question

The relationship between labor usage and output at the local coffee shop is summarized in the table below.The price of a cup of espresso is $1.25 and no other inputs are required. $$\begin{array} { c c } 
\begin{array} { c c } 
\text { Labor } \
\underline { \text { Input }}
\end{array} & \begin{array} { c } 
\text { Cups of } \
\underline { \text { espresso }}
\end{array} \
 0 & 0 \
1 & 25 \
2 & 45 \
3 & 60 \
4 & 70 \
5 & 75
\end{array}$$
The marginal product of the third worker is __________ than the marginal product of the second worker which means __________.

Quizplus · Accepted Answer

The marginal product of labor is calculated by the change in output divided by the change in labor input. Using the table, we can see that the marginal product of the second worker is 20 (output changes from 25 to 45 with an additional labor input of 1), while the marginal product of the third worker is only 15 (output only increases from 45 to 60 with an additional labor input of 1). This indicates that the third worker is less productive than the second worker, which means that diminishing returns are present (i.e. additional workers are becoming less and less productive). Therefore, the best choice is B.

The Relationship Between Labor Usage and Output at the Local