Nisha Sharma posted an Question
August 02, 2021 • 20:20 pm 30 points
  • Commerce

Aiw dys d gicalei lail zcio. cause of diminishing factor 1. under utilization of fixed factor : in initial stage of production, fixed factors of production like

aiw dys D gIcalei lail ZCIO. Cause of Diminishing Factor 1. Under Utilization of Fixed Factor : In initial stage of production, fixed factors of production like land or machine is under-utilized. More units of variable factor, like labour, are needed for its proper utilization. As a result of employment of additional units of variable factors there is proper utilization of fixed factor. In short, increasing returns to a factor begins to manifest itself in the first stage. 2. Fixed Factors of Production : The foremost cause of the operation of this law is that some of the factors of production are fixed during the short period. When the fixed factor is used with variable factor, then its ratio compared to variable factor falls. Production is the result of the co-operation of all factors. When an additional unit of a variable factor has to produce with the help of relatively fixed factor, then the marginal return of variable factor begins to decline Contact Us: Wahcita: e adu

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  • Rucha rajesh shingvekar best-answer

    under utilization of fixed factor - After making the optimum use of fixed factor, the marginal return of variable factor begins to diminish. For example, if a machinery (fixed factor) is at its optimum use, when 4 labours are employed, then addition of one more labour will increase TP by very less amount and MP will start diminishing. Fixed Factors of Production: The law of diminishing returns applies because certain factors of production are kept fixed. All factors of production, land, labour, capital or enterprise cannot be increased every time.


    mam please see what is written in the pic that point under utilization of fixed factor...whatever u have xplained here is all about optimum production

  • Nisha sharma

    how can be the first point be the cause of diminishing factor


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