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What is the law of diminishing marginal returns When is too many resources counterproductive?
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What war the 3 stages of production?
Three stages of production are increasing marginal returns, diminishing marginal returns, and negative marginal returns.
What is a level of production in which the marginal production decrease with new investment?
diminishing marginal returns
What is a level of production in which the marginal production decreases with new investment?
diminishing marginal returns
What circumstances cause a firm to experience diminishing marginal returns?
As the number of new employees increases the marginal product of an additional employee will be less than the previous employee which can cause a firm to experience diminishing marginal returns.
What are the stages of production of a firm?
a]increasing marginal returns b]diminishing returns c]negative returns
Why do firms experience increasing marginal returns and then diminishing marginal returns?
The short answer would be supply and demand. As demand for the firms increase, they will experience increasing returns. Likewise, as demand decreases, so do their returns.
Why is the production possibility curve bowed out from the origin of the curve?
Diminishing Marginal returns to capital and labor.
What is the law of diminishing returns?
the law of diminishing returns states that as a set of variable factors is added to a set of fixed factor, the marginal product and average product will first increase then eventually decrease
Clearly differentiate between diminishing marginal utility and diminishing marginal returns?
utility: means a level of satsfection. marginal utility:an extra unit gain my consumer/consumation of addational unit. deminishing marginal utility:when a person reachs his max level of satsfection by consuming a specific product then his utility will be falling by incresing the rate of consuming goods. diminishng marginal return & Diminishing marginal utility is same.
What level at which the marginal production goes up with new investment?
The level at which marginal production goes up with new investment is generally referred to as the point of diminishing returns. Beyond this point, each additional unit of investment yields a smaller increase in output or productivity. This occurs as resources become more scarce or inefficiently allocated, resulting in a decrease in the marginal return on investment.
Why avc curve U shape?
Overall because of diminishing marginal returns. The marginal cost curve, MC, decreases until diminishing marginal returns set in and and it begins to increase. When the MC is below the AVC, the AVC must fall. When the MC is above the AVC, the AVC must rise. In otherwords, if the marginal cost is decreasing the average cost must be decreasing as well and vice versa.
What is the difference between diminishing returns and diseconomies of scale?
The principle of diminishing marginal returns to inputs is when more on one input is added, while other inputs are held constant, the marginal product of the input diminishes. Diseconomies of scale or decreasing returns to scale is when the a firm doubles its inputs, output increases by less than double. With diminishing returns, only one input is being changed while holding the other is fixed. But for decreasing returns, both inputs may change
