Running head: WEEK THREE ASSIGNMENT 1

Microeconomics

Assignment week 2

Florida National University

2019
 WEEK THREE ASSIGNMENT 2

#1.

Marginal productivity is largely associated with the factors of production, labor, land and

capital. What we can call today human capital, physical resources and financial resources. And it

represents the variation that production will have if any of these factors is increased by one unit.

Marginal costs are simply the costs we cause when producing an additional unit.

(McEachern, 2018)

The assessment of the marginal product of labor and the estimation of marginal costs help

determine whether it is worthwhile to manufacture additional products. A fundamental analysis

for any company that wants to expand its market or billing levels.

Marginal productivity or marginal product, is the additional output generated by an

additional unit of resource whether human, physical (raw material or equipment) and financial.

When we talk about the increase in production generated by an additional worker or man-hours,

we talk about marginal labor productivity. When the Total Average Cost is decreasing

(increasing) it is greater (less) than the Marginal Cost. (McEachern, 2018)

• The Total Average Cost is equal to the Marginal Cost in the Optimal Exploitation.

When the Variable Average Cost is decreasing (increasing) it is greater (less) than the

Marginal Cost. (Authors, 2014)

• The Variable Average Cost is equal to the Marginal Cost in the Minimum of

Exploitation. (Authors, 2014)

#2
 WEEK THREE ASSIGNMENT 3

Efficiency is a relative concept, which is obtained by comparison with other available

alternatives, considering the resources used to achieve the results. productive efficiency is a

versatile term, since there is not a single type but several, depending on the objective the

company proposes; So we can talk about cost efficiency, if you try to minimize these, income

efficiency if you plan to maximize it, or efficiency in profit, if the planned objective is to

maximize it. To evaluate these types of efficiency, it is necessary to have information on market

prices, since these determine the type of optimal performance in each case. (McEachern, 2018)

However, regardless of the criteria that guide the performance of companies, and current

prices, there is a type of basic efficiency, not linked to any economic objective, which consists in

the proper use of the resources used; This type of efficiency is called technical efficiency.

(Mankiw, 2017)

The allocative efficiency consists in choosing, among the combinations of technically

efficient inputs and outputs, the one that is cheaper according to the prices of the inputs.

productive factors are required to be combined in the way that is cheaper: we call that factor

allocative efficiency. (McEachern, 2018)

If the objective is to maximize income (from a given amount of factor), there is a need for

technical efficiency and it is also required that the products be obtained in the proportions that

allow higher revenues, which we call allocative efficiency in the productions. Finally, if the

company maximizes the benefits, in that case it must be technically and allocatively efficient in

the productions and the factors; and in addition, it must produce with the most economically

adequate plant size. (Mankiw, 2017)

References
 WEEK THREE ASSIGNMENT 4

Authors, M. (2014). Principles of Microeconomics. openstax.

Mankiw, N. G. (2017). Principles of Microeconomics. Kindle.

McEachern, W. A. (2018). Microeconomics ECO2023. Cengage.