To produce 150 units of output, a firm must use 3 employees per day. To produce 300 units of output, the firm must use 8 employees per day. Apparently, the firm is:
A)producing in the long run.
B)experiencing diminishing returns.
C)not using any fixed factors of production.
D)experiencing negative returns.

Question

Quizplus · Accepted Answer

If production exhibits diminishing returns, then it takes ever-larger increases in the variable input to increase output by a given amount.

To Produce 150 Units of Output, a Firm Must Use