According to the traditional view, in what direction is the slope of the production function, with capital per worker on the horizontal axis and output per worker on the vertical axis?
A) The slope is positive and becomes steeper as capital per worker rises.
B) The slope is positive and becomes flatter as capital per worker rises.
C) The slope is constant.
D) The slope is negative and becomes steeper as capital per worker rises.

Question

Quizplus · Accepted Answer

According to the traditional view, the slope of the production function is positive because as capital per worker increases, output per worker also increases. However, the slope becomes flatter as capital per worker rises because of diminishing marginal productivity.

According to the Traditional View, in What Direction Is the Slope