Question

What is the shape of marginal product curve during the operation of law of diminishing returns?

Answer 1

The Marginal Product (MP) curve slopes downward when the Law of Diminishing Returns is in effect. After a while, the additional output (also known as the marginal product) from each additional unit of a variable input (such as labour) added to a fixed input (such as capital) begins to decline. The MP curve slopes downward as a result of this declining marginal product. Therefore, during the time of diminishing returns, the MP curve has a downward slope.