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When more workers are hired, the land begins to get 'crowded'. Each worker now has insufficient land to work efficiently. So the output added by each additional worker is now proportionally less as a result the marginal product begins to __________.

Solution

✅ Correct Option: 3

Option 1 -> If marginal product were constant, each additional worker would add the same output, contradicting the scenario.

Option 2 -> If marginal product were rising, each additional worker would add more output than the previous one, which is opposite to what's described.

Option 3 -> As land becomes crowded and workers have insufficient land, the output added by each additional worker decreases proportionally, meaning marginal product falls.

Option 4 -> Zero marginal product means no additional output is produced, which is an extreme case not described here.


Hence, Option 3: Fall -> This scenario illustrates the Law of Diminishing Marginal Returns. When a variable input (labor) is added to a fixed input (land), initially marginal product may rise, but eventually it begins to fall as the fixed factor becomes a constraint. Each additional worker has less land to work with, leading to overcrowding and reduced efficiency. Therefore, the marginal product (additional output from each extra worker) begins to fall, though it remains positive. -> correct

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