The marginal product of labor initially rises as more labor is employed because of:
A) division and specialization of labor.
B) constant returns to scale.
C) total factor productivity.
D) an increase in profits from the additional output produced.
E) a fall in the cost of hiring additional labor.

Question

Quizplus · Accepted Answer

The division and specialization of labor allows workers to become more efficient at their specific task, increasing the output per worker and thus the marginal product of labor initially rises.

The Marginal Product of Labor Initially Rises as More Labor