The source of diminishing returns is

Question

Quizplus · Accepted Answer

Diminishing returns occur when adding more and more units of a variable input, such as labor, to a fixed amount of capital results in smaller and smaller increases in output per unit of the variable input. This is because the fixed amount of capital becomes increasingly inefficient at accommodating additional units of the variable input. Therefore, the correct option is C. A and D are incorrect because they do not fully explain the source of diminishing returns, and B is incorrect because it is a false statement that increasing labor always leads to more output.

The Source of Diminishing Returns Is