A corn gather can be a class in diminishing returns.
The abstraction of diminishing returns comes from economics, where it's one of the basics of Industry impression, the recite of turning economic "inputs," such as way or manpower, into "outputs," or goods and services. Simply settle, diminishing returns occurs when successively more advantageous input produces lesser and lesser output.
Returns
A Often cited object of the doctrine of diminishing returns concerns a farmer hoping to boost production--of, claim, corn--on a plot of land. At this location, he's getting a stable go back: Everyone ton of fertilizer ups his glean by 15 bushels per acre.
Marginal Returns
In the fourth year, the farmer lays down three tons of fertilizer, and ends the year with a pick of 140 bushels per acre. One year, he plants corn however doesn't employ any fertilizer, and come glean generation, he has a income of 100 bushels per acre. The closest year, he puts down one ton of fertilizer, and he gets a harvest of 115 bushels per acre. The year after that, he puts down two tons of fertilizer, and his earth returns 130 bushels of corn per acre.In year 5, he puts down four tons and has a reap of 145 bushels per acre. He's experiencing what's called "diminishing marginal returns." That is, the repay he gets for Everyone further input--each additional ton of fertilizer--is getting smaller and smaller. Depending on the worth of fertilizer and the cost he gets for his corn, those third and fourth tons of fertilizer may de facto be costing him resources.
Total Returns
Year 6 comes encompassing, and the farmer goes ahead and puts down five tons of fertilizer. However at this speck the earth has been overworked, and there's so even fertilizer in the ground that it's starting to harm the plants. When the collect comes in, his output has dropped to 130 bushels per acre. That additional ton of fertilizer has led to a snare loss in output. He's double time experiencing "diminishing complete returns."
Fixed Factors
A pivotal carefulness is that other factors of Industry must be fixed, or unchanging, to create an environment in which diminishing returns can occur. In the case of the farmer, it's the size of his field and the amount of seed he plants. If every year he planted more seed on more ground, then the steady increase in fertilizer might not have produced the diminishing returns.
Diseconomies of Scale
Diminishing returns is not to be confused with "diseconomies of scale," a different kind of production inefficiency. In diseconomies of scale, each additional input can produce the same output, but at a greater cost. For instance, a factory might keep adding workers to boost production, but eventually it can't find any more workers at the rate it's paying, so it needs to raise wages. At the same time, the increased production saturates the local market, so the products must be shipped longer distances to new markets.
