Chapter 10R, Problem 8MCQ

To determine

Relationship between marginal product and total product.

Answer to Problem 8MCQ

(d) Increasing at a decreasing rate.

Explanation of Solution

With the application of an additional unit of a variable input, the marginal product is positive and

declining which means the contribution of the additional unit of input is positive yet less than the previous

unit hence the total output will be increasing however at the decreasing rate. Hence, option (d) is correct.

Option (a), (b), (c), and (e) are incorrect because the marginal product is the rate of change of total output, here marginal product is positive and declining, which means the total product is increasing but the rate of increment is declining and therefore in this case total product would increase as decreasing rate.

Economics Concept Introduction

Introduction:

Introduction: marginal product is the addition to total output due to the use of an additional unit of an input, while total product is the level of output produced by a given quantity of inputs.

Marginal product: change in the quantity of output/change in the quantity of labor.

MC=ΔTC∕ΔQ