00:01
This question says if a firm has diminishing returns to label over some range of outputs, he cannot have economics of skill over that range, true or false.
00:11
So if a firm has diminishing returns to label, okay, let me put this way.
00:36
If a firm has diminishing returns to label over some range of outputs, then you cannot have economics of scale over that range.
00:42
But this is a true or false question.
00:44
And we can say that when a firm has diminishing marginal returns, which is diminishing returns of labor, then it may be true that the marginal product is falling.
00:57
Right.
00:59
So we can say that the marginal products may be falling.
01:03
So when that happened, the cost will be increasing and because of that, of the marginal returns are diminishing when all the costs, including lrtc, are increasing.
01:17
So let me put it this way.
01:19
When the firm has diminishing, i'm sorry, your firm has diminishing marginal returns, then the marginal products may be failing, rather falling...