Which of the following statements is true?
A) When marginal product is less than average product, average product is increasing.
B) When marginal product is less than average product, average product is decreasing.
C) When marginal product is falling, average product is decreasing.
D) When marginal product is rising, average product is decreasing.

Question

Quizplus · Accepted Answer

When marginal product is less than average product, it implies that the value of the marginal product is below the current level of average product. This would bring down the value of the average product, leading to a decreasing trend. Therefore, option B is the correct statement. The other options are incorrect as they are either contradicted by economic theory or illogical.

Which of the Following Statements Is True