Question

We often observe that addition of another unit of labor increases output but by an amount that is smaller than the addition of the previous unit of labor. In such a situation the producer is experiencing
diminishing labor.

diminishing output.

diminishing marginal product.

negative marginal product.

Answer 1

Answer:

The producer is experiencing diminishing marginal product.

Explanation:

The law of diminishing return explains that every additional unit consumed will have less utility/return than the previous one. Same is the case with labor productivity. The first unit of labor will yield maximum return, every additional unit will result in lesser return/productivity than the previous unit. The will continue up to the point of maximum return. After that point adding additional resources will yield less total output.