Problem 1: What is average productivity? What is marginal productivity? Explain the relationship between marginal and average productivity. What would happen to marginal and average productivity if a technological innovation is introduced to the production process? Provide examples (numerical and graphical if you can) to explain your answer.
Problem 2: What is the law of diminishing marginal productivity? Give an example from your workplace of the law of diminishing marginal productivity? Might diminishing marginal productivity impact the costs?