The Law of Diminishing Marginal Returns States That

Multiple Choice

The law of diminishing marginal returns states that:

A) when the marginal product is above the average product, average product must be increasing.
B) when the marginal product is below the average product, average product must be decreasing.
C) as the use of one input increases holding the quantities of the other inputs fixed, the marginal product of the input eventually declines.
D) as the use of all inputs increases, the marginal product of the inputs eventually declines.