Which of the following describes how output changes in the short run? Because of specialization and the division of labor, as more workers are hired,
A)output will first increase at an increasing rate, then output will increase at a decreasing rate.
B)output will first decrease at an increasing rate, then increase at a decreasing rate.
C)the marginal product of labor will first decrease, then increase at a decreasing rate.
D)the marginal product of labor will first be negative and then will be positive.

Question

Quizplus · Accepted Answer

As more workers are hired, output will first increase at an increasing rate due to specialization and the division of labor. However, as the number of workers increases, the marginal product of labor will eventually diminish, causing output to increase at a decreasing rate. This is known as the law of diminishing marginal returns.

Which of the Following Describes How Output Changes in the Short