Question

State and Explain the Law of Diminishing Return

Answer 1

Answer:

In economics, diminishing returns is the decrease in the marginal output of a production process as the amount of a single factor of production is incrementally increased, while the amounts of all other factors of production stay constant.

Answer 2

In Microeconomics or Production Economics,law of diminishing marginal returns states that as any one or single factor/input of production is increasingly employed in the production of any good or service keeping the other factor inputs constant,its marginal productivity decreases as the production or output level increases.

Explanation:

• Law of diminishing returns implies decreasing marginal productivity of any one particular factor/input of production with its increasing employment in the production process,keeping the other factors/inputs of production fixed.
• Based on the law of diminishing return,as the firm or any company increases the use or employment of any one or single factor/input of production in the production of any good or service by keeping the other factor inputs constant,its additional or incremental productivity gradually decreases as the firm or company expands output or production level.In other words,the additional productivity or efficiency of any single factor/input of production or the additional output obtained by employing one more unit of that factor input in the production process decreases progressively,keeping all other factors/inputs.