In the short run, the marginal product of labor:
A) is always diminishing.
B) will eventually fall.
C) continues to increase as long as the firm adds labor slowly.
D) always increases because laborers become more efficient with experience.

Question

Quizplus · Accepted Answer

The marginal product of labor refers to the additional output produced by adding one more unit of labor, holding all other inputs constant. In the short run, as more units of labor are added, the marginal product of labor will eventually fall due to the law of diminishing marginal returns. This law states that, holding all else constant, as more of one input (labor, in this case) is added to a fixed amount of other inputs (like capital), the additions to output will eventually decrease.

In the Short Run, the Marginal Product of Labor