The fact that the production function relating output to labour becomes flatter as we move from left to right means that
A)the marginal product of labour is positive.
B)the marginal product of capital is positive.
C)there is diminishing marginal productivity of labour.
D)there is diminishing marginal productivity of capital.

Question

Quizplus · Accepted Answer

As the production function becomes flatter, it indicates that the additional output produced by an additional unit of labor is decreasing or that there is diminishing marginal productivity of labor. Therefore, the correct choice is C. The marginal product of capital is not mentioned or relevant in this scenario.

The Fact That the Production Function Relating Output to Labour