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(5) Discuss some of the advantages and disadvantages associated with assuming that a firm's production function exhibits diminishing marginal returns over its entire range.
(5) Discuss some of the advantages and disadvantages associated with assuming that a firm's production function exhibits diminishing marginal returns over its entire range. Use a diagram to illustrate advantages associated with weakening the assumption to assuming diminishing returns after some output, Q* is reached. [You should write on the order of 6 sentences to answer these questions. Several of your sentences should refer to your diagram. (Hint: I suggest that you focus on one-input production processes to simplify your discussion and diagram.)
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