AQA A-Level Economics 2025/6

Economics • A-Level

Question 1 of 114

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According to the law of diminishing returns, what happens when a firm increases one variable input while keeping other inputs constant?

Hint: Think about how increasing one variable input affects production up to a point.

Variable costs start to decline as more units are produced. Fixed costs per unit decrease as production increases. Output decreases indefinitely. Total output initially increases but at a decreasing rate until a certain point is reached.

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