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15 April, 14:27

A farm is able to produce 5,000 bushels of peaches per season on 100 acres. Assume it adds one more acre and is able to produce 6,000 bushels per season. The marginal product of the additional acre of land for this farm is:

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  1. 15 April, 14:35
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    Marginal product = 1,000

    Explanation:

    Marginal product can be defined as a change in output resulting from a change in factor input.

    It is calculated by

    Marginal product (MP) = Change in output/change in inputs

    That is,

    MP = ∆Q/∆input

    At

    inputs = 100 acres of land

    Output = 5,000 bushels of peaches

    At

    Inputs=101 acres

    Output=6000 bushels of peaches

    Marginal product = Change in output/change in inputs

    Change in output = New - old

    =6,000-5,000

    =1,000 bushels of peaches

    Change in inputs = New - old

    = 101-100

    =1 acre

    Marginal product = 1000/1

    = 1,000
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