Figure 3.1
-In Figure 3.1 the average product of capital is:
A)rising.
B)constant.
C)falling.
D)unknown.

Name: Figure 3.1 -In Figure 3.1 the average product of capital is: A)rising. B)constant. C)falling. D)unknown.
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Question

Figure 3.1 
-In Figure 3.1 the average product of capital is:
A)rising. 
B)constant. 
C)falling. 
D)unknown.

Quizplus · Accepted Answer

The graph shows that as the amount of capital used increases, the output (measured by average product) initially increases but then begins to decrease. Therefore, the average product of capital is falling, making choice C the correct answer.

Figure 3.1 -In Figure 3.1 the Average Product of Capital Is