Which of the following is consistent with diminishing marginal returns?
A)increasing labor by 10% and output increasing 10%.
B)increasing labor by 10% and output prices increase by less than 10%.
C)increasing labor by 10% and the marginal product of labor increasing 10%.
D)increasing labor by 10% and output increasing by less than 10%.

Question

Quizplus · Accepted Answer

Diminishing marginal returns means that as you increase one input (such as labor), while holding all other inputs constant, the marginal product of that input will eventually decrease. Option D is consistent with this concept because it shows that an increase in labor by 10% leads to an increase in output by less than 10%, indicating the law of diminishing marginal returns.

Which of the Following Is Consistent with Diminishing Marginal Returns