Why Is the Marginal Revenue Product Curve of a Factor

question 65

Multiple Choice

Why is the marginal revenue product curve of a factor negatively sloped?

• A)Additional revenue generated from an additional unit of a factor remains constant as more resources are hired.
• B)Additional revenue generated from an additional unit of a factor declines as more resources are hired.
• C)Additional revenue generated from an additional unit of a factor usually becomes zero as more resources are hired.
• D)Additional revenue generated from an additional unit of a factor increases as more resources are hired.
• E)Additional revenue generated from an additional unit of a factor doubles every time new resources are hired.

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