Refer to the following:
The amount of total output produced from various combinations of labor and capital.

$\begin{array}{cccc}
&\text { Units of Capital }\
&& 1 & 2 & 3&4 \
\hline &1 & 50&120&160&180 \
\text {Units }&2 & 110&260&360&390 \
\text {of }&3 & 150&360&510&560\
\text {Labor }&4 & 170&430&630&690 \
&5 & 160&4801&710&790 \
\end{array}$
-If the capital stock is fixed at one unit, diminishing returns begin with the
A) first unit of labor.
B) second unit of labor.
C) third unit of labor.
D) fourth unit of labor.
E) fifth unit of labor.

Question

Refer to the following:
The amount of total output produced from various combinations of labor and capital.

$\begin{array}{cccc} 
&\text { Units of Capital }\
&& 1 & 2 & 3&4 \
\hline  &1 & 50&120&160&180 \
\text {Units }&2 & 110&260&360&390 \
\text {of }&3 & 150&360&510&560\
\text {Labor }&4 & 170&430&630&690 \
&5 & 160&4801&710&790 \
\end{array}$
-If the capital stock is fixed at one unit, diminishing returns begin with the
A) first unit of labor.
B) second unit of labor.
C) third unit of labor.
D) fourth unit of labor.
E) fifth unit of labor.

Quizplus · Accepted Answer

Diminishing returns begin when each additional unit of labor adds less to output than the previous unit. Here, the first unit of labor adds 50, the second adds 60, and the third adds 40, indicating diminishing returns start with the third unit.

Refer to the Following: the Amount of Total Output Produced

Refer to the Following:
the Amount of Total Output Produced