7 The law of diminishing returns states thatа.as a firm uses more of a variable resource, given the quantity of fixed resources, theaverage product of the firm will increaseb.as a firm uses more of a variable resource, given the quantity of fixed resources,marginal product of the firm will eventually decreaseС.in the short run, the average total costs of the firm will eventually diminishd. in the long run, the average total costs of the firm will eventually diminish

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Economics

The law of diminishing returns states that

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Cost Of Production

Section: Chapter Questions

Problem 3CQQ

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Question

The law of diminishing returns states that
а.
as a firm uses more of a variable resource, given the quantity of fixed resources, the
average product of the firm will increase
b.
as a firm uses more of a variable resource, given the quantity of fixed resources,
marginal product of the firm will eventually decrease
С.
in the short run, the average total costs of the firm will eventually diminish
d. in the long run, the average total costs of the firm will eventually diminish

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