The law of diminishing returns states that as
A) the size of a plant increases, the firm's fixed cost decreases.
B) the size of a plant increases, the firm's fixed cost increases.
C) a firm uses more of a variable input, given the quantity of fixed inputs, the marginal product of the variable input eventually diminishes.
D) a firm uses more of a variable input, given the quantity of fixed inputs, the firm's average total cost will decrease eventually.

Question

Quizplus · Accepted Answer

The law of diminishing returns states that as more units of a variable input are added to fixed inputs, the additional output produced by each additional unit of the variable input will eventually decrease.

The Law of Diminishing Returns States That as