A downward-sloping marginal product of labour curve demonstrates the law of diminishing marginal returns.

Question

Quizplus · Accepted Answer

The law of diminishing marginal returns states that as more units of a variable input (such as labour) are added to a fixed input (such as capital), the marginal product of that variable input will eventually decline. This is typically represented by a downward-sloping marginal product of labour curve. Therefore, the statement "a downward-sloping marginal product of labour curve demonstrates the law of diminishing marginal returns" is true.

A Downward-Sloping Marginal Product of Labour Curve Demonstrates the Law