Because of the "law of diminishing marginal returns" to a factor, as more labor is employed, its marginal product:
A) rises.
B) falls.
C) stays constant.
D) rises disproportionally.

Question

Quizplus · Accepted Answer

According to the law of diminishing marginal returns, as more units of a variable input (in this case, labor) are added to a fixed input (such as land or capital), the marginal product of the variable input will eventually decrease. This means that the additional output produced by each additional unit of labor will be less than the previous unit of labor added. Therefore, the marginal product of labor falls as more labor is employed.

Because of the "Law of Diminishing Marginal Returns" to a Factor