Because of diminishing returns to capital,further increases in the quantity of capital in China would be represented as ________ the Chinese production function.

Question

Quizplus · Accepted Answer

Diminishing returns to capital imply that as more capital is added, the additional output produced from each additional unit of capital decreases. This is represented as a movement up along the production function, as more capital leads to higher output, but at a decreasing rate.

Because of Diminishing Returns to Capital,further Increases in the Quantity