Figure 12-1
-Refer to Figure 12-1.Which of the following could explain why the total product curve would shift from TP2 to TP1?
A) There is additional capital equipment available to the firm.
B) Labor skills have become rusty and outdated in the firm.
C) The firm has developed improved production technology.
D) The firm is now receiving a higher price for its product.

Question

Figure 12-1 
-Refer to Figure 12-1.Which of the following could explain why the total product curve would shift from TP2 to TP1?
A) There is additional capital equipment available to the firm. 
B) Labor skills have become rusty and outdated in the firm. 
C) The firm has developed improved production technology. 
D) The firm is now receiving a higher price for its product.

Quizplus · Accepted Answer

A shift from TP2 to TP1 indicates a decrease in productivity. Rusty and outdated labor skills would lead to a reduction in the efficiency of labor, causing the total product curve to shift downwards.

Figure 12-1 -Refer to Figure 12-1.Which of the Following Could Explain Why