According to the Law of Diminishing Marginal Returns,as additional units of one input are employed as all other inputs are held constant,total output will eventually ______.
A) Decrease
B) Increase at an increasing rate
C) Increase at a decreasing rate
D) Increase at a constant rate

Question

Quizplus · Accepted Answer

The Law of Diminishing Marginal Returns states that as more of one input (such as labor) is added while holding all other inputs (such as capital) constant, the marginal product of that input will eventually decrease. This means that total output will still increase, but at a decreasing rate. Eventually, adding more of the input will result in a decrease in total output, which is known as the point of diminishing returns. Therefore, the best choice is C, increase at a decreasing rate.

According to the Law of Diminishing Marginal Returns,as Additional Units