Use the following figure to answer the questions : Figure 7-1 shows the total product curve for different levels of a variable input,labor.

-In Figure 7-1,marginal product of labor is positive but lesser than the average product of labor after point _____.
A)A
B)B
C)C

Question

Use the following figure to answer the questions : Figure 7-1 shows the total product curve for different levels of a variable input,labor.

-In Figure 7-1,marginal product of labor is positive but lesser than the average product of labor after point _____.
A)A 
B)B 
C)C

Quizplus · Accepted Answer

After point C, the slope of the total product curve (which represents the marginal product of labor) is positive but less than the slope of the average product curve. This means that while additional units of labor are still adding to total output (hence, a positive marginal product), they are not adding as much (on average) as the units of labor that were already employed. Therefore, the best choice for maximizing output would be to hire up to the point where the average product of labor is at its highest, which is point C. Hiring any more workers beyond this point would result in lower average product and, eventually, negative marginal product.

Use the Following Figure to Answer the Questions : Figure