The slope of the production function turns from positive to negative when the marginal product of labor turns from positive to negative.

Question

Quizplus · Accepted Answer

The slope of the production function turns from positive to negative when the marginal product of labor becomes negative, but this is incorrect; the slope of the production function represents the marginal product of labor, and it becomes negative only if the production function itself were to decrease with more labor, which is highly unusual in economic contexts. Normally, the slope may decrease (indicating diminishing marginal returns), but it remains positive as long as the marginal product of labor is positive.

The Slope of the Production Function Turns from Positive to Negative