As more labor is added to a fixed amount of capital,eventually the marginal product of labor decreases.

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Quizplus · Accepted Answer

This is the law of diminishing returns, which states that as more units of a variable input (in this case, labor) are added to a fixed input (in this case, capital), eventually the marginal product of the variable input will decrease. This occurs because the fixed input becomes a limiting factor on production.

As More Labor Is Added to a Fixed Amount of Capital,eventually