Once diminishing returns have set in,each additional unit of output:
A)requires less of the variable input than the previous unit.
B)requires less cost outlay than the previous unit.
C)requires more of the fixed input than the previous unit.
D)requires more cost outlay than the previous unit.

Question

Quizplus · Accepted Answer

Diminishing returns occur when adding an additional unit of input leads to a smaller increase in output. This means that each additional unit of output requires more cost outlay than the previous unit due to the decreasing marginal physical product. As the production becomes less efficient, the cost of producing additional units increases.

Once Diminishing Returns Have Set In,each Additional Unit of Output