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4 Economics Questions...

Just answers the 4 questions below using some economic concepts.

1.) give an example that depicts the law of diminishing marginal returns. Please do not use the example for the questions below, use something else.

2.)Please give comment and what you think??? I am going to use labor examples from my old profession. I owned a landscape company before I joined the service. I initially thought that if I could just hire more guys I could get all of my jobs done faster. This wasn't always the case.

Dealing with a specific job case and labor productivity as the diminishing product. I was installing sod lawn there were several stacks of sod and an area of yard that needed to be laid. I had stacks of sod on palletsbut could only uncover could only uncover one at a time or the sod would dry out. I figured that more labor would help me out. Instead I had guy's stacking up waiting on each other to take a piece of sod and lay it. I was about one laborer over on my estimate. If I would have removed one laborer there would have been no need for pause and we could have continualy moved from sod pile to ground without interuption.

I noticed when we backed up at the pile that once a person stopped to pause their mind would also wonder and loose focus on the job. When laying sod, time is very important. At the end of the day I relized I was paying out 100 dollars to a person I never needed. The law of diminishing returns had snuck up on me.

I also saw this in the Military. We sometimes had more people than work, sometimes. In the military if you don't need everyone you try and find something for them too do it's not the most efficient organization by far. My supervisors would put 4 guys on one vehicle repair but most of the repairs were under the hood in the same area. The end result was people chatting it up and to many hands in a small place which ended up in wasted man hours.Two people would have been more than sufficient to complete the job in the same amount of time. Although in the circumstance of the military we have to be prepared for when we do need all those hands....It is better to have more their than not enough. But for that specific example the law of diminishing return had the best of us and the more we added to it the less productive it became.

3.)Please give comment and what you think??? An example of diminishing marginal returns would be salespeople in a clothing store.

If you are an owner of this clothing store, obviously you would want enough staff to operate the store and take care of its customers. Having enough employees would mean shorter lines, more people to assist you in finding a specific article of clothing, people manning the fitting room, people putting clothes away, etc..

If this same proprietor decided to add more staff (beyond what was already determined as enough based on his level of business and # of customers, etc.), it would no longer be beneficial for him because this person would cost more in wages than the amount of work this person could perform. It then becomes a situation where the marginal returns start to diminish.

4.)Please give comment and what you think??? Businesses are in business to make a profit. If selling one tire causes a profit to be made, then why not make and sell millions and millions of them? As overhead increases and more employees are brought in, the costs of each of those tires increases. It can get to a point where it is no longer profitable enough (per tire) to stay in business. That is why there are more thana few tire manufacturers. No one manufacturer could supply all the tires. They would be too expensive.