The fact that limited use of caffeine can improve mental alertness and help performance,while excessive use of caffeine can cause anxiety and trembling shows _____.
A)that coffee is an inferior good
B)the law of diminishing marginal returns with respect to test performance
C)the law of returns to scale with respect to test performance
D)decreasing returns to scale in coffee production

Question

Quizplus · Accepted Answer

The law of diminishing marginal returns states that as one input is increased while all other inputs are held constant, there will be a point at which the marginal increase in output will start to decrease. In the case of caffeine and mental alertness/performance, a limited use of caffeine can provide a boost in performance, but excessive use of caffeine can cause negative effects such as anxiety and trembling, leading to a decrease in performance. This demonstrates the concept of diminishing marginal returns in this context. The other options (A, C, D) are not applicable or relevant to the given scenario.

The Fact That Limited Use of Caffeine Can Improve Mental