In general, as the amount of labor input increases, the amount of output
A)increases.
B)decreases.
C)remains constant.
D)increases only if the capital stock also increases.

Question

Quizplus · Accepted Answer

According to the law of increasing marginal returns, as more units of labor are added to a fixed amount of capital, the marginal product of labor (output per unit of labor) initially increases. Therefore, the total output will also increase. However, after a certain point, the marginal product of labor will start to decrease, leading to diminishing marginal returns.

In General, as the Amount of Labor Input Increases, the Amount