-In the above figure, Graph D with units of capital on the vertical axis and units of labor on the horizontal axis implies that
A)the marginal product of labor is increasing as more labor is employed.
B)the marginal product of labor is decreasing as more labor is employed.
C)the capital and labor are perfect substitutes.
D)capital and labor have to be employed in fixed proportions.

Question

-In the above figure, Graph D with units of capital on the vertical axis and units of labor on the horizontal axis implies that
A)the marginal product of labor is increasing as more labor is employed. 
B)the marginal product of labor is decreasing as more labor is employed. 
C)the capital and labor are perfect substitutes. 
D)capital and labor have to be employed in fixed proportions.

Quizplus · Accepted Answer

The marginal product of labor is increasing as more labor is employed because the graph is upward sloping.

-In the Above Figure, Graph D with Units of Capital