Question
Diminishing marginal returns __________.
hold true when “capital is fixed” is a key assumption
occur in the long run
occur when each additional worker hired is becoming more productive than the previous worker
do not occur in a competitive market
hold true when “capital is fixed” is a key assumption
occur in the long run
occur when each additional worker hired is becoming more productive than the previous worker
do not occur in a competitive market
Answers
GPT-4o mini
Diminishing marginal returns **hold true when “capital is fixed” is a key assumption**.
This concept states that as you continue to add more of one input (like labor) to a fixed amount of another input (like capital), the additional output produced by the new input will eventually decrease. This is commonly illustrated in a production setting where one factor (usually capital) is held constant while the other factor (labor) is increased.
This concept states that as you continue to add more of one input (like labor) to a fixed amount of another input (like capital), the additional output produced by the new input will eventually decrease. This is commonly illustrated in a production setting where one factor (usually capital) is held constant while the other factor (labor) is increased.