As the quantity of labor increases while the amount of other inputs are held constant, marginal product of labor will
A) increase continuously.
B) decrease continuously.
C) initially decrease and then increase.
D) initially increase and then decrease.

Question

Quizplus · Accepted Answer

Initially, as more labor is added, the marginal product of labor will increase. This is because the additional worker brings complementary skills and specialization of tasks, which increases overall productivity. However, as more workers are added, there will be diminishing returns to labor. The fixed amount of other inputs will limit the extent to which each additional worker can contribute to production, resulting in a decrease in the marginal product of labor. Therefore, the marginal product of labor will initially increase and then decrease.

As the Quantity of Labor Increases While the Amount of Other