Question

The law of increasing returns is also known as:

• A. The law of diminishing costs
• B. The law of increasing costs
• C. The law of constant costs
• D. The law of variable proportions

Answer 1

The correct option is A The law of diminishing costs

The law of increasing returns is also called the law of diminishing costs. The law of increasing return states that:
The tendency of the marginal return to rising per unit of variable factors employed in fixed amounts of other factors by a firm is called the law of increasing return".