When firms add workers and find that the additional workers add less to output than their predecessors did, they are experiencing

Question

Quizplus · Accepted Answer

Diminishing returns occur when the marginal product of an additional unit of labor decreases when other inputs are held constant. This means that as firms add more workers, the additional workers may not contribute as much to output as the earlier workers did, resulting in diminishing returns.

When Firms Add Workers and Find That the Additional Workers