Because of diminishing returns to capital,additions to or improvements in __________ are not the most effective way to increase average labour productivity.

Question

Quizplus · Accepted Answer

Diminishing returns to capital imply that there is a point after which adding more physical capital (such as machines or equipment) becomes less efficient in increasing productivity. Therefore, improving or adding more physical capital is not always the most effective way to increase productivity.

Because of Diminishing Returns to Capital,additions to or Improvements in __________