Which of the following is not correct regarding Stage I of Law of variable proportions with Labour (L)…
In Stage I, average product of labour rises: \(dAP_L/dL=(MP_L-AP_L)/L>0\). Marginal product therefore exceeds average product until the boundary, making the claim MP_L <…
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Which of the following is not correct regarding Stage I of Law of variable proportions with Labour (L) as variable factor and Land (N) and Capital (K) as fixed factors ?
Answer and explanation
Correct answer C
In Stage I, average product of labour rises: . Marginal product therefore exceeds average product until the boundary, making the claim MP_L < AP_L incorrect.
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