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The table below represents the yield of maize in 90kg bags in response to different quantities of planting fertilizer. (i) Fill in the blank spaces. (ii) Suggest the best level of production in relation to the inputs and output.

Economics

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Here's the completed table and the suggestion for the best level of production.

11. (a) The table below represents the yield of maize in 90kg bags in response to application of different quantities of planting fertilizer

Part i· 1 step

Fill in the blank spaces

To fill the table, we use the following formulas:

  • Average Product (AP) = Total OutputTotal Input\frac{\text{Total Output}}{\text{Total Input}}
  • Marginal Product (MP) = Change in Total OutputChange in Total Input\frac{\text{Change in Total Output}}{\text{Change in Total Input}}
  1. Calculate AP and MP for each input level.

    Input 50kg bag fertilizerOutput 90kg bag maizeAverage product (AP)Marginal product (MP)
    06--
    110101=10\frac{10}{1} = 1010−61−0=4\frac{10-6}{1-0} = 4
    224242=12\frac{24}{2} = 1224−102−1=14\frac{24-10}{2-1} = 14
    331313≈10.33\frac{31}{3} \approx 10.3331−243−2=7\frac{31-24}{3-2} = 7
    436364=9\frac{36}{4} = 936−314−3=5\frac{36-31}{4-3} = 5
    540405=8\frac{40}{5} = 840−365−4=4\frac{40-36}{5-4} = 4
    643436≈7.17\frac{43}{6} \approx 7.1743−406−5=3\frac{43-40}{6-5} = 3
    743437≈6.14\frac{43}{7} \approx 6.1443−437−6=0\frac{43-43}{7-6} = 0
    840408=5\frac{40}{8} = 540−438−7=−3\frac{40-43}{8-7} = -3

    Completed Table:

    Input 50kg bag fertilizerOutput 90kg bag maizeAverage product (AP)Marginal product (MP)
    06--
    110104
    2241214
    33110.337
    43695
    54084
    6437.173
    7436.140
    8405-3

Part ii· 2 steps

Suggest the best level of production in relation to the inputs and output

  1. Analyze the Marginal Product (MP) and Total Output.

    The total output of maize increases up to 43 bags, which is achieved with both 6 and 7 bags of fertilizer.
    The marginal product (MP) shows the additional output from each extra bag of fertilizer.

    • MP is positive and decreasing from the 3rd bag to the 6th bag.
    • At 7 bags of fertilizer, the MP is 0, meaning the 7th bag of fertilizer did not add any extra maize output.
    • At 8 bags of fertilizer, the MP is -3, meaning the 8th bag actually caused the total output to decrease.
  2. Determine the optimal level.

    The best level of production, in terms of maximizing physical output without wasting resources, is where the marginal product is zero. Beyond this point, adding more input leads to a decrease in total output.

    The best level of production is at 7 bags of fertilizer, yielding 43 bags of maize. At this point, the marginal product is 0, indicating that maximum total output has been achieved, and adding more fertilizer would be inefficient or even detrimental.

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