When the marginal product curve is downward- sloping, the average product curve
A) must be horizontal.
B) must also be downward- sloping.
C) must be upward- sloping.
D) might be either upward- or downward- sloping.

Question

Quizplus · Accepted Answer

When the marginal product curve is downward-sloping, it indicates diminishing returns to a factor of production. The average product curve can be either upward-sloping if the average product is still increasing despite diminishing marginal returns, or downward-sloping if the average product is decreasing. This depends on whether the marginal product is above or below the average product at a given level of output.

When the Marginal Product Curve Is Downward- Sloping, the Average