Name: Instructor: Course Date: COURSEWORK ASSIGNMENT 2 In Utoprica, there are two types of vehicle: cars and buses. 6 people repair vehicles (or make a new vehicle, if an old one can’t be repaired): each person works on cars or buses, but not both. In Utropica, 16 machines are used to make/repair cars or buses; a machine cannot be used for both cars & buses…
Download file to see previous pages...
This is because the return scale decreases as the production factors are increased. Diminishing returns take place when the labour marginal productivity begins to fall. In the present case, an extra unit of labour is added to a fixed capital when production of buses takes place. It reaches a place where marginal production of extra labour is maximized after which the output for each additional unit of labour falls. Diminishing returns is a law that takes place because production factors like capital labour inputs are imperfect substitutes (Jehle & Philip, 2000). This implies that when producing a product like for this paper, buses and cars, the resources put in use are inefficient when turned for a production of a different service or another good. For instance, workers deployed in the vehicle industry to make buses and cars may be inefficient, if they are re-employed in a cement producing industry. Similarly, quite a number of item involving capital equipment specify to a single type of production. If switched to different uses, there would be inefficiency in production of output. Production factors like capital and labour are said to be immobile occupationally as they can be turned to other functions, although with a resultant productivity loss. An inverted relationship does exist between production factors and the cost of production of a unit in a firm. When there is low productivity, cost per unit of supplying service or a good turns out to be higher (Frank, 2006). Therefore, a firm can get higher returns and be efficient in its labour force leading to higher profits and lower costs. Here, K represents capital employed in the form of machine while L stands for labour employed which in this paper is the number of men who repair or make new vehicles. Using N buses = 0.4 K1.1 L0.41 L=0 L=1 L=2 L=3 L=4 L=5 L=6 K=16 0 8.4 11.0 13.5 15.2 16.0 17.7 K=14 0 7.3 9.5 11.7 13.1 13.9 15.3 K=12 0 6.2 8.0 9.8 11.1 11.7 12.9 K=10 0 5.0 6.5 8.1 9.1 9.6 10.6 K= 8 0 4.0 5.1 6.3 7.1 7.5 8.3 K= 6 0 2.9 3.7 4.6 5.2 5.5 6.0 K= 4 0 1.8 2.4 2.9 3.3 3.5 3.9 K= 2 0 0.9 1.1 1.4 1.5 1.6 1.8 K= 0 0 0.0 0.0 0.0 0.0 0.0 0.0 Task B Edge worth box This box is frequently used in a theory of general equilibrium. It helps represent competitive equilibrium in a range of outcomes, which satisfies economic efficiency. It can also aid in detecting difficulty in reaching efficiency in the presence of a bilateral monopoly. From the table above, it is noted that as the number of men is increased holding machine constant number of buses produced increase but in a decreasing rate. This implies that the output or returns to scale diminishes. Therefore, it means that the ratio of employed labour to the number of machines is not that proportional. This creates inefficient use of resources, and in this case, it is the labour employed. If labour is not used efficiently, the firm incur a lot of costs in the form of salaries and wages that are not effectively used (Mas-Colell et al., 1995). This may lead a firm to diminishing returns to scale. If there is no labour or machine employed, there is no output at all as output is only evident when there is a combination of the two. On the other hand, holding labour constant and adding more machines leads to a steady output as the labour that is available can only use up to a certain no of machines. Task C In the edge box, there are two curves for cars and buses. Whenever
...Download file to see next pagesRead More
Cite this document
(“Coursework Assignment Essay Example | Topics and Well Written Essays - 1250 words”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1395857-microeconomics
(Coursework Assignment Essay Example | Topics and Well Written Essays - 1250 Words)
“Coursework Assignment Essay Example | Topics and Well Written Essays - 1250 Words”, n.d. https://studentshare.org/macro-microeconomics/1395857-microeconomics.
Other factors that explain wheat price change are the rapidly increasing costs of oil prices and the continuing devaluation of the US dollar. The US dollar is used as an economic indicator in quoting pricing for commodities. Droughts caused wheat production to decline in some wheat producing countries.
I feel that this computer is not of acceptable quality and it does not match with the sample that we assessed in your stores. To solve this issue, I would appreciate if you would replace the computer with another one with the same specifications. I have enclosed the copy of the receipt as a proof for purchase.
The company offers a huge range of products including food items, general merchandise, accessories, household items, and electrical products. In addition to its core business the company also provides financial services including insurance and retail banking.
The legislation also encourages collective knowledge by allowing the work to revert back to the public to be available freely as a public source after the defined period of time. It is quite possible that new knowledge could be developed over the existing knowledge which was made public.
Focus is shifting from competition among companies to better cover the customer needs which calls for thorough market research techniques and careful examination of customer needs. Such implementation of new strategies requires adaptation of current college curriculum to the market reality.
Funding of US$ 2 billion has been earmarked by the government for policy measures to support this strategy. At its previous meeting, the committee decided that this funding should be devoted to policy measures that will increase the country's rate of enrolment in secondary education.
Management accounting is a branch of accounting, which is mainly dealing with various managerial aspects mainly handled by the managers within the organization, which is essential for taking appropriate decisions. The concept of management accounting is under the control of Management accountant who is responsible for the preparation of financial statements, and management accounting report for taking appropriate decisions.
In order to maintain and keep up with the pace, human resource managers face various problems on how to manage the workforce effectively on an international level. Managing international human resources allows and enables
The double taxation treaty has been introduced in order to minimize the issue related to introduction of tax rate on a uniform basis. This treaty is introduced with the purpose of preventing tax evasion. The model tax convention has been adopted by
8 Pages(2000 words)Essay
GOT A TRICKY QUESTION? RECEIVE AN ANSWER FROM STUDENTS LIKE YOU!
Let us find you another Essay on topic Coursework Assignment for FREE!