The "Law" of Diminishing Returns

question 21

Multiple Choice

The "law" of diminishing returns

• A)is deduced from the basic biochemical relationship of agricultural theory.
• B)was constructed as the basis of observation during experiments on the impact of fertilizer on output in the 1930s.
• C)is based on regular observations of input-output relationships over the last two centuries.
• D)is borrowed from physical laws related to conversion of matter and energy.

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Definitions:

Marginal Utility

The increased gratification or utility derived from the consumption of an extra unit of a good or service.

Energy Drink

A type of beverage containing stimulant compounds, usually caffeine, that is marketed as providing mental and physical stimulation.

Utility

Describes the complete fulfillment derived from the use of a product or service.

Demand Curve

A graph showing the relationship between the price of a good and the amount of the good that consumers are willing to purchase at that price, ceteris paribus.