JAMB - Economics (2016 - No. 10)
If additional unit of a variable factor input causes a fall in the marginal product, this implies that
Total product starts declining
Average product has become zero
Diminishing returns has set in
Increasing returns is operating
Forklaring
diminishing returns is the decrease in the marginal output of a production process as the amount of a single factor of production is incrementally increased, while the amounts of all other factors of production stay constant.