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What is the law of diminishing returns?

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Quick answer

The law of diminishing returns says that adding more of one input eventually produces smaller and smaller gains. For example, one more worker helps a lot at first, but past a point each extra worker adds less — a key idea in economics and productivity.

Key things to understand

  1. Adding more of an input yields shrinking extra output.
  2. Early additions help a lot; later ones help less.
  3. It guides how much of a resource to use.
  4. It applies to work, study, fertilizer, spending, and more.

People also ask

What is the law of diminishing returns?
The principle that beyond a point, each extra unit of input produces a smaller increase in output.
What's an example of diminishing returns?
Studying helps, but the tenth hour in a row adds far less than the first.
Why do diminishing returns matter?
They help decide the most efficient amount of a resource to use before extra input is wasted.