Decreasing marginal returns
A) can be avoided if a firm watches costs.
B) affect all firms, but at different production levels.
C) affect all firms at the same level of production.
D) disappear when the firm produces a large enough level of output.
E) mean that the average product of labor starts as a negative number and then becomes positive.

Question

Quizplus · Accepted Answer

Decreasing marginal returns occur when increasing one input while holding all others constant eventually leads to smaller and smaller increases in output. This affects all firms, but the point at which it occurs depends on the specific production processes and technologies used by each firm.

Decreasing Marginal Returns