Consider a Basket- Producing Firm with Fixed Capital

Multiple Choice

Consider a basket- producing firm with fixed capital.If the firm can produce 36 baskets per day with 3 workers and then increases productivity to 44 baskets per day with 4 workers,then which of the following statements is true?

A) The marginal product of the fourth worker is 11.
B) The firm has passed the point of diminishing average productivity.
C) With 4 workers,the firm's average product of labour is 13.
D) The firm has not yet reached the point of diminishing marginal productivity.
E) The marginal product is above the average product.