Marginal Product and Resources
We can identify from this reading that as more quantity is produced, inputs used can be purchased in larger quantities – known often as economies of scale.
Why was this not the case during 2020 to 2022? What happened in the markets that prevented this normal mechanism from working?
There were many factors at play so be sure you select at least three (for example, labor supply, costs of supplies, availability of supplies, costs of distribution, and prices of products).
Why should the firm’s output return to a more normal cost curve over time? Explain what happened to at least two different types of producer’s profits during 2020 – 2022.
