In the short-run,diminishing marginal returns are associated with:
A)declining average variable costs.
B)rising marginal cost.
C)rising average fixed cost.
D)falling average total cost.

Question

Quizplus · Accepted Answer

Diminishing marginal returns occur when adding one more unit of variable input causes a less than proportional increase in output. This leads to an increase in marginal cost, as more units of input are required to produce each additional unit of output. Therefore, choice B, rising marginal cost, is the correct answer. Additionally, choices A, C, and D are incorrect because they do not reflect the relationship between diminishing marginal returns and costs in the short-run.

In the Short-Run,diminishing Marginal Returns Are Associated With