In a Cobb-Douglas production function the marginal product of labor will increase if:
A) the quantity of labor increases.
B) the quantity of capital increases.
C) capital's share of output increases.
D) average labor productivity decreases.

Question

Quizplus · Accepted Answer

In a Cobb-Douglas production function, the marginal product of labor increases when the quantity of capital increases because capital and labor are complementary inputs. Increasing the amount of capital available for each worker makes each worker more productive.

In a Cobb-Douglas Production Function the Marginal Product of Labor