At 76 units of labor, a firm finds that average product of labor equals 39.6 and marginal product of labor equals 42.9.We can conclude that the average product curve at 76 units of labor is:
A) upward-sloping.
B) downward-sloping.
C) vertical.
D) horizontal.

Question

Quizplus · Accepted Answer

When the marginal product of labor (42.9) is greater than the average product of labor (39.6), it means that the addition of the last unit of labor has increased the average output per worker. This indicates that the average product curve is upward-sloping at 76 units of labor.

At 76 Units of Labor, a Firm Finds That Average