-Refer to Scenario 3.Diminishing marginal returns are incurred when output is increased from:
A)1 to 2 units of output.
B)2 to 3 units of output.
C)3 to 4 units of output.
D)4 to 5 units of output.

Question

-Refer to Scenario 3.Diminishing marginal returns are incurred when output is increased from:
A)1 to 2 units of output. 
B)2 to 3 units of output. 
C)3 to 4 units of output. 
D)4 to 5 units of output.

Quizplus · Accepted Answer

Diminishing marginal returns occur when adding an additional factor of production results in a smaller increase in output. In this scenario, the transition from 3 to 4 units of output represents the point where additional inputs lead to less proportional increases in output, indicating diminishing marginal returns.