Final answer:
The relationship between the average product of labor and the marginal product of labor can be explained by the Law of Diminishing Marginal Product. If the average product of labor is less than the marginal product, then the marginal product will be decreasing. This is because the additional output produced by each additional worker is lower than the average output of the previous workers.
Step-by-step explanation:
The relationship between the average product of labor and the marginal product of labor can be explained by the Law of Diminishing Marginal Product. According to this law, as additional workers are hired, the marginal product of labor initially increases and then begins to decline. This decline in the marginal product of labor is reflected in the relationship between the average product of labor and the marginal product of labor.
If the average product of labor is less than the marginal product of labor, it indicates that the marginal product is decreasing. This is because the additional output produced by each additional worker is lower than the average output of the previous workers. On the other hand, if the average product of labor is greater than the marginal product of labor, it implies that the marginal product is increasing. This means that each additional worker is contributing more to the total output than the average output of the previous workers.
Based on this information, the correct statement regarding the relationship between the average product of labor and the marginal product of labor is option (iv): if the marginal product is less than the average product, then the average product will be decreasing.