2021 Paper 1 (section B)

Question 1

Explain the likely impact of diminishing marginal productivity of labour on cabin crew staffing levels (5 marks) 122

Answer 1

• staff levels fall
• DMP definition (additional unit of labour the additional increase in productivity declines so the additional cost of hiring more labour needs to be set against the additional productivity gained

(AP) - explains why american airlines are reducing staff due to lower marginal productivity of additional crew.T