1968EconomicsMedium
An individual firm’s demand for a factor of production?
Aslopes upward due to the factor’s increasing marginal product
Bis perfectly elastic (horizontal) if the factor market is perfectly competitive
CSlopes downward due to the factor’s diminishing marginal product
DSlopes downward because an increase in the production of output reduces the price at which the output can be sold in a competitive market, thereby reducing the value of the marginal producing the value of the marginal product as more of the factor is use
Correct answer
C. Slopes downward due to the factor’s diminishing marginal product
Explanation
The correct answer is Slopes downward due to the factor’s diminishing marginal product.