As the amount of a variable input increases, while all other inputs are held constant, total product will
A) always increase.
B) always decrease.
C) initially decrease and then increase.
D) initially increase and then decrease.

Question

Quizplus · Accepted Answer

Initially, as more of the variable input is added while holding other inputs constant, the marginal product of that input will increase due to specialization and division of labor. This will lead to an increase in total product. However, at some point, adding more of the variable input will lead to diminishing marginal returns, and the marginal product will start to decline. This will cause total product to increase at a decreasing rate, and eventually, it may even start to decline if the variable input is overused. Therefore, total product will initially increase and then decrease.

As the Amount of a Variable Input Increases, While All