Which of the following statements is true?

Question

Quizplus · Accepted Answer

The law of diminishing returns states that as more and more units of a variable input are added to a fixed input, the marginal product of the variable input will eventually decrease. Therefore, statement D is correct. Statement A is false because eventually, as more and more labour is used, the marginal product will decrease due to diminishing returns. Statement B is false because eventually, the marginal product of labour will decrease due to diminishing returns. Statement C is false because diminishing returns can occur even when all inputs are fixed.

Which of the Following Statements Is True