The principle of diminishing returns to capital states that,if the amount of labour and other inputs employed are held constant,then,as more and more units of capital are used,eventually,

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Quizplus · Accepted Answer

The principle of diminishing returns to capital states that as more and more units of capital are used while holding other inputs constant, the amount added to production for each additional unit of capital will be smaller than the amount added for the previous unit of capital. This means that eventually, the increase in production will not be worth the cost of adding more capital, resulting in diminishing returns. Therefore, option E is the correct answer.

The Principle of Diminishing Returns to Capital States That,if the Amount