CAIE A-Level Economics 7.5.1 Short-run production function

CAIE A-Level Economics 7.5.1 Short-run production function
Cambridge International AS & A Level Economics 9708 syllabus for exams in 2026, 2027 and 20282026–2028

Practise short-run production analysis using fixed and variable factors, labour productivity and product measures.

How this is tested

  • calculate labour productivity, average product or marginal product from output data
  • predict total output when marginal product is positive but diminishing
  • distinguish diminishing returns from returns to scale when fixed factors remain unchanged

Question 16

[Maximum number: 1]

As the number of workers employed by a firm increases, the marginal product of labour decreases but remains positive.

What happens to the firm's total output?

A

It stops increasing.

B

It increases at a constant rate.

C

It increases at a falling rate.

D

It increases at a rising rate.