The marginal benefit schedule for capital slopes downward because

Question

Quizplus · Accepted Answer

The marginal benefit schedule for capital slopes downward primarily because the marginal productivity of capital declines as more capital is used. This is a reflection of the law of diminishing returns, which states that as the quantity of one factor of production (in this case, capital) increases while other factors remain constant, the additional output (marginal product) generated by the additional capital will eventually decrease.

The Marginal Benefit Schedule for Capital Slopes Downward Because