Diminishing marginal returns to labor occur because
A) after a while it is hard to find a good worker.
B) the capital resources used by the firm are fixed in the short run.
C) workers become more efficient over time.
D) larger companies are less efficient.

Question

Quizplus · Accepted Answer

Diminishing marginal returns to labor occur when adding an additional worker results in a smaller increase in output, often because the capital resources are fixed in the short run, limiting the productivity of additional workers.

Diminishing Marginal Returns to Labor Occur Because