Diminishing Marginal Returns Occur When

question 167

Multiple Choice

Diminishing marginal returns occur when

• A) the average product of the variable input eventually diminishes.
• B) the marginal product of an additional worker is less than the marginal product of the previous worker hired.
• C) the firm hires cheap, less-skilled workers in place of expensive, high-skilled workers.
• D) total product diminishes.

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Definitions:

Segment Expenses

Costs that are directly associated with specific divisions or operational segments of a company.

Profit

The financial benefit that is realized when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes associated with the activity.

Loss

An accounting term that represents the excess of expenses over revenues in a specific period, leading to a decrease in equity.

Disaggregation

Disaggregation involves breaking down financial information or data into smaller, more detailed components, often for analytical purposes.