Diminishing marginal returns refers to the:
A)decline in the rate at which extra inputs are employed in production.
B)fall in average product associated with a unit increase in the fixed input.
C)decline in total product which is less than proportionate to a change in the fixed input.
D)fall in output per unit with an incremental increase in the variable input.

Question

Quizplus · Accepted Answer

Diminishing marginal returns occur when adding one more unit of a variable input to a fixed input results in a decrease in output per unit of the variable input. In other words, the increase in output that comes from adding an extra unit of the variable input becomes smaller and smaller as more units are added. This is represented by a downward-sloping marginal product curve.

Diminishing Marginal Returns Refers to The