The average productivity of labor reaches its maximum:
A)at the point of inflection of the total product curve.
B)where the slope of the total product curve is steepest.
C)where the slope of the total product curve is zero.
D)where marginal and average productivity are equal.

Question

Quizplus · Accepted Answer

The point at which marginal and average productivity are equal represents the maximum productivity of labor, as any additional unit of labor input would decrease the average productivity. This is because marginal productivity, the additional output produced by one additional unit of labor, decreases beyond this point as the law of diminishing returns sets in.

The Average Productivity of Labor Reaches Its Maximum