The principle that if one factor of production is fixed and constant addition of other factors are combined with it, the marginal productivity of variable factors will eventually decline ?
Correct answer: B. Diminishing returns
- A. Marginal returns
- B. Diminishing returns
- C. Both
- D. NoneAccess Government Careers
Explanation
The law of diminishing returns states that when one input is fixed, adding more units of a variable input will eventually reduce its marginal product. This is also called diminishing marginal returns.
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