The law of increasing marginal costs states that
A)Ceteris paribus, as more and more of an activity are done; the additional costs of the activity tend to decrease.
B)Ceteris paribus, as more and more of an activity are done; the additional costs of the activity tend to increase.
C)Ceteris paribus, as more and more of an activity are done; the additional benefits of the activity tend to decrease.
D)Ceteris paribus, as more and more of an activity are done; the additional benefits of the activity tend to increase.

Question

Quizplus · Accepted Answer

The law of increasing marginal costs states that as production increases, the additional cost of producing each additional unit tends to increase. This is due to the fact that as production increases, resources become scarcer and more difficult to obtain, which results in higher costs.

The Law of Increasing Marginal Costs States That