At 47 units of labor, a firm finds that average product of labor equals 39.6 and marginal product of labor equals 32.9.We can conclude that the average product curve at 47 units of labor is:
A) upward-sloping.
B) horizontal.
C) vertical.
D) downward-sloping.

Question

Quizplus · Accepted Answer

When MPL < APL, APL must be declining. Therefore, since MPL < APL at 47 units of labor (32.9 < 39.6), the average product curve must be downward-sloping.

At 47 Units of Labor, a Firm Finds That Average