Question

Compare the two terms increasing marginal returns and diminishing marginal returns describe two scenarios one to explain and demonstrate each term

Answer 1

Step-by-step explanation:

Diminishing marginal result is the outcome of increase in a particular factor of production while other factors remain constant , consequently a decrease in the marginal output of such production. A scenario is watering of a flower pot. Continuous addition of water will be of benefit to a certain level when further addition will be of negative effect to the plant.

Increasing marginal returns is the increase in the marginal output when a fixed input factor of production is topped up with a unit variable ,It is more useful in short run production. A scenario is hiring extra manpower in order to meet up with a demand of a production order.

Answer 2

Increasing marginal returns mean that as the input is increased (such as labor), the productivity will increase. This will likely happen if there is enough space in the workplace for more labor. On the other hand, diminishing marginal returns mean that as the input is increased, the productivity will diminish or decrease.