Answer:
A company can take advantage of THE LAW OF DIMINISHING RETURNS, as the MARGINAL PRODUCT of the first group of workers will increase, but at a certain point it will decline. At this point, TOTAL OUTPUT will continue to increase, but marginal product will diminish with each additional worker. Eventually there will be too many workers and not enough PRODUCTION FACTORS to keep them busy, inevitably slowing down production and reducing output.
Explanation:
I'm not sure about the exact words, but the basic idea should be the same even if you use other words with similar meaning.
This paragraph describes the law of marginal returns. In simple words, if you start with one worker, his/her productivity will generally be low. As you start to add more workers, both total output and productivity increases (due to synergy between workers). But at some point, there are too many workers, and too few resources, e.g. to many chefs inside a kitchen. At that point, since there are too many workers, instead of working well, they will start to complicate each other's performance. This will result in a decline of productivity, even if total output continues to increase.
The correct words to fill the given blanks would be as follows:
The law of Diminishing Returns
Marginal Product
Total Output
Production factors
The law of Diminishing Returns states that after the optimum productive ability is reached, the addition of a particular input while others being will influence its efficiency to fall.
This is the cause that the marginal product generated after every additional input would cause a fall after reaching the optimum level.
The reason behind this would be that resources would fall short to keep the inputs engaged all the time.
Learn more about "Output" here:
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