In the short run, a firm's capital is fixed and more workers are employed. The law of diminishing marginal product means that:
Correct answer: B. Additional workers eventually add less output
- A. Total output immediately begins to fall
- B. Additional workers eventually add less output
- C. Average product remains constant at every level
- D. Fixed cost rises with every additional worker
Explanation
With capital fixed, successive workers eventually contribute smaller additions to total output. Total output may still rise, but it rises at a decreasing rate.
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