Diminishing returns. Watch

Dylan2409
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How do you show diminishing returns on a diagram?
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idk01
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Draw a diagram showing the marginal product curve that at first, as output increases, goes up but then soon after starts to go down as the amount of output you are getting from each extra unit of input is decreasing
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Maria678
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Show an LRAC curve made of SRAC curves. output is increasing but at a decreasing rate. the variable factors become constrained by the fixed factors therefore you must simultaneously increase your variable factors and fixed factors in order to prevent them from getting in the way of each other. each variable factor is producing less additional output hence costs increase from C1 to C2 . the increase in costs should be seen from the MES of SRAC 1 to where SRAC 2 intersects SRAC 1 as output increases from Q1 to Q2
Last edited by Maria678; 1 month ago
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