Question

"Law of diminishing returns" or "Law of variable proportion" operate in ___________.

• A. long run
• B. short run
• C. very long period
• D. none of the above

Answer 1

The correct option is B short run

For the law of diminishing returns or variable proportions to operate, at least one factor needs to be fixed, as only then can factor proportions be changed, this happens in the short run. In the long run all factors are variable and thus it is not possible for the law of diminishing returns or law of variable proportions to operate.