If diminishing marginal returns have already set in for Golden Lark Woodworks, and the marginal product of the 6th carpenter is 8 chairs, then the marginal product of the 7th carpenter is

Question

Quizplus · Accepted Answer

When diminishing marginal returns have set in, the marginal product of each additional unit of the variable input decreases. Since marginal product of the 6th carpenter is 8 chairs, it means that the marginal product of the 7th carpenter will be less than 8 chairs due to diminishing marginal returns. Therefore, the correct answer is B.

If Diminishing Marginal Returns Have Already Set in for Golden