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AP® Microeconomics

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Diminishing Marginal Returns

APMICR-GYLC3E

A unique short-run problem in the production of a particular good is the Law of Diminishing Marginal Returns.

Which of the following statements best explains this phenomenon?

A

As Jack eats continuous slices of pizza, he gains less and less enjoyment from each slice.

B

Because large-scale production allows the realization of economies of scale, the real costs of production vary directly with the level of output.

C

As more workers are added to work on a project that has a fixed amount of capital resources for them to work on, beyond some point the resulting extra output will begin to decline.

D

Population growth automatically adjusts to that level at which the average product per worker will be at a maximum.

E

Proportionate increases in the inputs of all resources will result in a less-than-proportionate increase in total output.