Production And Costs

Quickly browse through questions and notes on related topics. You can also download and read this topic offline.

Zigya App

The Law Of Diminishing Marginal Product And The Law Of Variable Proportions

Law of Diminishing Marginal Product: It says that if we keep increasing the employment of an input, with other inputs fixed, eventually a point will be reached after which the marginal product of that input will start falling.

Law of Variable Proportions: It says that the marginal product of a factor input initially rises with its employment level. But after reaching a certain level of employment, it starts falling.