What is Basic reason of operating the law of Diminishing return ?
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The law of diminishing returns, also referred to as the law of diminishing marginal returns, states that in a production process, as one input variable is increased, there will be a point at which the marginal per unit output will start to decrease, holding all other factors constant
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Law of diminishing return :
Law of diminishing return also known as principle of diminishing marginal productivity states that if any one input of production such as units of labor or capital is increased keeping all other inputs as constant, a point will be reached where the marginal productivity per unit output starts to decrease.
In short, it may also be known as Law of variable Proportions.
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