Question

Diminishing marginal returns means that as you combine more units of a variable resource with a set of fixed resources:

a. the marginal physical product of the variable input decreases.

b. the average physical product of the fixed inputs increases at an increasing rate.

c. the marginal physical product of the variable input increases at a decreasing rate.

d. the total output decreases.

e. the marginal physical product of the variable input increases at a constant rate.