Diminishing returns occur because

Question

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Diminishing returns occur when a firm increases the amount of a variable input, such as labor, without changing the amount of a fixed input, such as capital. As a result, each additional unit of the variable input leads to a smaller increase in output, eventually reaching a point where further increases in the variable input lead to a decrease in output. This occurs because the fixed input becomes a constraint on the production process.

Diminishing Returns Occur Because