The law of diminishing marginal returns:
A)is relevant in both the short and the long-run.
B)says that increasing fixed inputs eventually results in smaller and smaller increases in total output.
C)says that increasing variable inputs eventually results in smaller and smaller increases in total output.
D)says that increasing variable inputs eventually results in smaller and smaller increases in total cost.

Question

Quizplus · Accepted Answer

The law of diminishing marginal returns states that as successive units of a variable input are added to a fixed input, the marginal product will eventually decrease. This means that increasing variable inputs (not fixed inputs) will result in smaller and smaller increases (not decreases) in total output. Therefore, the correct answer is C.

The Law of Diminishing Marginal Returns