Question

The "law of diminishing returns" applies to :
(a) the short-run, but not the long-run
(b) the long-run, but not the short-run
(c) both the short-run and the long-run
(d) neither the short-run nor the long-run

Answer 1

Explanation:

The law of diminishing returns states that as an increasing amount of a variable factor is added to a fixed factor, the marginal product of the variable factor may at first rise but must eventually fall.The law of diminishing returns applies in the short run because only then is some factor fixed.