Question: In a manufacturing plant, workers use a specialized machine to produce belts. A new machine is invented that is laborsaving. With the new machine, the

In a manufacturing plant, workers use a specialized machine to produce belts. A new machine is invented that is laborsaving. With the new machine, the firm can use fewer workers and still produce the same number of belts as it did using the old machine. In the long run, both labor and capital (the machine) are variable. From what you know, what is the effect of this invention on the APL, MPL, and returns to scale? If you required more information to answer this questions, specify what you need to know.

Step by Step Solution

3.36 Rating (168 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

In the short run the marginal product of the first few workers wi... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

349-B-E-M-E (3071).docx

120 KBs Word File

Students Have Also Explored These Related Economics Questions!