If diminishing marginal returns have already set in for Danica's Dog Training Emporium and the marginal product of the fifth dog trainer is 18, then the marginal product of the fourth dog trainer must be
A) negative.
B) zero.
C) less than 18.
D) greater than 18.

Question

Quizplus · Accepted Answer

The principle of diminishing marginal returns states that as more units of a variable input (in this case, dog trainers) are added to fixed inputs, the additional output (marginal product) from each new unit of input will eventually decrease. Therefore, if the marginal product of the fifth dog trainer is 18, the marginal product of the fourth dog trainer must have been greater than 18, before the diminishing returns set in.

If Diminishing Marginal Returns Have Already Set in for Danica's