According the law of diminishing returns ?
Correct answer: A. The marginal product fall as more units of a variable factor are added to a fixed factor
- A. The marginal product fall as more units of a variable factor are added to a fixed factor
- B. Marginal utility falls as more unity of a product are consumed
- C. The total product falls as more units of a variable factor are added to a fixed factor
- D. The marginal product increases as more units of a variable factor are added to a fixed factor
Explanation
The law of diminishing returns states that, after a point, adding more units of a variable factor to fixed factors causes marginal product to fall. Marginal utility is a separate consumer theory concept, not the law being tested here.
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