Ask Question
31 December, 01:01

As more output is produced, the marginal product of labor declines because the firm's marginal revenue declines: a) if the firm's output supply curve is inelastic. b) if firms reduce the wage paid to labor. c) because of the law of diminishing returns.

+5
Answers (2)
  1. 31 December, 01:42
    0
    Option C. because of the law of diminishing returns.

    Explanation:

    The law of diminishing returns states that as more of any particular input is added, while holding all the other inputs constant, its marginal product will eventually decline. Therefore, as marginal productivity declines, so does marginal revenue.

    In the scenario presented above, the marginal productivity of each successive addition of labor, will eventually lead to an increase which is less than proportionate.
  2. 31 December, 02:55
    0
    The correct answer is c) because of the law of diminishing returns.

    Explanation:

    The law of diminishing returns establishes that if all the other productive factors are kept constant and only one productive factor increases, the total production will increase less and less. In other words, what this law refers to is the fact that adding an element, which until then had been the best option, ceases to be, that is, that there is a better alternative, but from which it is crossed the line of diminishing returns is no longer the best option, it may even be counterproductive.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “As more output is produced, the marginal product of labor declines because the firm's marginal revenue declines: a) if the firm's output ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers