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25 June, 09:33

If marginal product is 4 units and average product is 8 units, the next worker will cause (A) marginal product to increase. (B) average product to increase by 4 units. (C) marginal product to become negative. (D) marginal product to increase by 2 units and average product to decrease by 2 units. (E) average product to decrease.

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  1. 25 June, 09:58
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    (D) marginal product to increase by 2 units and average product to decrease by 2 units.

    Explanation:

    When there will be an addition in number of workers then the marginal product that is additional units for each additional worker will increase.

    But, at the same time as for calculating the average the units will decrease with the same proportion.

    This is because with extra number of workers the denominator for average product will also increase and ultimately.

    In the curve the marginal and average product are same level for equilibrium.

    Thus, option D is correct.
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