With one input fixed, a firm will find that as it attempts to produce more, the total product curve will increase at a decreasing rate and its marginal product curve will be:
A)downward sloping.
B)upward sloping.
C)constant and horizontal at the marginal product axis.
D)constant and vertical at the quantity axis.

Question

Quizplus · Accepted Answer

The law of diminishing marginal returns states that as a firm increases the quantity of one input (assuming the other inputs are fixed), the marginal product of that input eventually decreases. Therefore, the marginal product curve will be downward sloping. The total product curve will still increase, but at a decreasing rate.

With One Input Fixed, a Firm Will Find That as It