When diminishing marginal returns set in,
A)average product is increasing.
B)average variable cost is decreasing.
C)average cost is decreasing.
D)None of above.

Question

Quizplus · Accepted Answer

When diminishing marginal returns set in, the additional output gained from each additional unit of input decreases. This leads to an increase in marginal cost and a decrease in marginal product. However, it does not necessarily lead to a change in average product, average variable cost, or average cost. Therefore, none of the above choices are correct.

When Diminishing Marginal Returns Set In