The rate at which one input can be exchanged for another without altering output is called
A)The slope of the total product curve
B)The marginal rate of technical substitution
C)The slope of the marginal product of labor
D)The law of diminishing returns of labor

Question

Quizplus · Accepted Answer

The concept described is known as the marginal rate of technical substitution (MRTS), which measures the rate at which a factor of production can be substituted for another while keeping output constant. Option A refers to the slope of the total product curve, which shows the output produced by varying levels of input. Option C refers to the slope of the marginal product of labor, which measures the additional output produced by adding one more unit of labor. Option D refers to the idea that at a certain point, adding more units of a variable input (like labor) will lead to diminishing returns, where the marginal product of that input decreases.

The Rate at Which One Input Can Be Exchanged for Another