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Jamien Sherwood
on Nov 25, 2024

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The law of diminishing returns only applies in cases where

A) there is increasing scarcity of factors of production.
B) the price of extra units of a factor is increasing.
C) there is at least one fixed factor of production.
D) capital is a variable input.

Law Of Diminishing Returns

An economic principle stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.

Fixed Factor

A resource in the production process that remains constant, regardless of the level of output or production over a certain time period.

  • Acquire insight into the effects of the law of diminishing returns on productivity and output.
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Alice PhumaleNov 29, 2024
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