The law of diminishing returns states that, ceteris paribus, the rate of profit from an investment will continue to diminish as more capital ins invested into that product.
What is Ceteris Paribus?
Ceteris Paribus is a Latin phrase often quoted in economics that means "all things being equal". It is used to connote the fact that in the consideration of a law, sometimes it is assumed that all other factors are given or at play.
It is to be noted that the Law of Diminishing Returns is also applicable to Labor, Utility and Marginal Returns.
Learn more about the Law of Diminishing Returns at;
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