The law of diminishing returns implies that: a given percentage increase in all

Question

The law of diminishing returns implies that:

a given percentage increase in all inputs leads to that same percentage increase in output.

a given percentage increase in all inputs leads to that same percentage increase in output.

output increases at a rate less than the proportionate increase in inputs.

none of these.

a given percentage increase in all inputs leads to that same percentage increase in output.

a given percentage increase in all inputs leads to that same percentage increase in output.

output increases at a rate less than the proportionate increase in inputs.

none of these.

Explanation / Answer

output increases at a rate less than the proportionate increase in inputs is the correct answer.

As Law of dimisnshing returns means that each additional unit of an input used will increase output, but by smaller and smaller amounts,so there is less increase in output than the increase in input. This law is based on the theory that there is always a optimal levels till where the firm should produce and beyond that there will be reduced returns.

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.