Answer:
diminishing returns,
Explanation:
The law of diminishing marginal returns claims that the returns from the input will first increase at an increasing rate until production reaches an optimal level. After the optimal level, and holding the other factors constant, the returns from the output will start diminishing and eventually turn negative.
Diminishing returns concepts apply in the short term, where only variable inputs can change. For example, in a factory setting, the optimal production capacity is fixed in the short-run. Additional usage of a variable such as labor increase returns until the factor reaches its optimal capital. Additional hiring of labor results in diminishing returns in labor output.
The law of diminishing marginal returns claims that the returns from the input will first increase at an increasing rate until production reaches an optimal level. After the optimal level, and holding the opposite factors constant, the returns from the output will start diminishing and eventually turn negative.
Diminishing returns concepts apply within the short term, where only variable inputs can change. for instance, in a very factory setting, the optimal production capacity is fixed within the short run. Additional usage of a variable like labor increase returns until the factor reaches its optimal capital. Additional hiring of labor leads to diminishing returns of parturient output.
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