Causes for diminishing returns to factor

What are the causes for diminishing returns to factor?

Answer:

1) Over utilization of fixed factors: As more and more units of the variable factor carries to be joined with similar fixed factor, the fixed factor gets over employed.

2) Imperfect factor substitution: More and more of variable factor can’t be continuously employed in place of fixed factor.

View Complete Question

Related Questions in Microeconomics

Q : Output level at wholesale price on

When the wholesale price per dozen roses is $4.50, the breakeven point for Rose Garden Wholesalers happens at an output level of about: (i) 2000 dozen roses. (ii) 2500 dozen roses. (iii) 3000 dozen roses. (iv) 3500 dozen roses. (v) 40

Q : Total utility of water in Paradox of

Clean drinking water is accessible at a much lower price than the costs of equal amounts of gold. This actuality is most reliable with the outcome that whenever a consumer is in equilibrium, then the: (i) Net utility of water is very higher than its marginal utility,

Q : Problem on Substitution Effect The cost

The cost of cashmere plummets and most of the people start employing this once costly material as pillow covers and to knit sweaters for their pets. This is an illustration of: (i) The income effect. (ii) The change in preferences and taste. (iii) The law of diminishi

Q : Poverty and Human Capital Enabling

Enabling labor to move out of low-wage occupations by enhancing their education, skills, training and mobility, which will tend to: (w) lower the wages of those who leave the low wage occupation. (x) raise the wages of those who remain in the low wage

Q : Complements for good Can someone help

Can someone help me in finding out the right answer from the given options. Price hikes outcome less substitution away from a good the more: (i) Close substitutes there are for good. (ii) Various uses there are to which the good was place at lower price. (iii) Extende

Q : Relative profitability and efficiencies

From around 1890 until 1970 year, the “structure-conduct-performance paradigm” dominated theories concerning how firms behave in various types of markets. Here the word “performance” in this context consider to things as: (i) d

Q : Economic growth Give the answer of

Give the answer of following question. Economic growth is best defined as an increase in: A) either real GDP or real GDP per capita. B) nominal GDP. C) total consumption expenditures. D) wealth in the economy.

Q : Negatively relative interest rate

Interest rates tend to be negatively associated to: (w) household preferences for more liquid assets. (x) typical rates of return on alternative investments. (y) household willingness to delay consumption. (z) investor optimism concerning rates of ret

Q : Wage Rates and Marginal Resource Costs

Can someone please help me in finding out the accurate answer from the following question. When a firm is the price taker in labor market and the salary is $80 per day, then the marginal resource cost incurred if hiring 20 more workers per day is as: (i) $1600. (ii) $

Q : What will occur when government taxes a

When the government taxes a good, the price consumers currently face is most probably: (w) higher than before the tax. (x) below the price the seller receives. (y) less than average production cost. (z) justified through welfare payments to taxpayers.

Discover Q & A

Leading Solution Library

Avail More Than 1419478 Solved problems, classrooms assignments, textbook's solutions, for quick Downloads

No hassle, Instant Access

Start Discovering

18,76,764

1939804
Asked

3,689

Active Tutors

1419478

Questions
Answered

Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!

Submit Assignment