Question

state with reasons whether the following statements are true or false :-?
(a) under diminishing returns to a factor, total product continuous to increase tail marginal product becomes zero.?
(b) law of variable proportions will not apply to agricultural sector.?
(c) in short run, production function factor ratio changes at different levels of output.?
(d) the law of variable proportions will apply across time periods, across industries.?
(e) marginal product is the measure of labour productivity.

Answer 1

Dear Student



1. True, TP increases at decreasing rate and MP falls. This phase ends when MP becomes zero and TP reaches the maximum point. After this Point, TP starts decreasing.
2. False, In agriculture, the law applies because the land is a constant factor and it can not be increased according to the over variable factors like labor and capital.
3. True, in the short run, production function factor ratio changes at different levels of output.The proportion between fixed and variable factor changes with every additional variable factor.
4. False, law of variable proportions is based on the following assumptions:

• It operates in short run
• This law applies to the field of production only.

5. True, The marginal product of a factor of production is generally defined as the change in output associated with a change in that factor, holding other inputs into production constant. The marginal product of labor is then the change in output (Y) per unit change in labor (L)


Regards