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Diminishing marginal returns occur when adding an input results in a decrease in output, while returns to scale refer to how output changes as all inputs are increased proportionately.
Diminishing marginal returns apply only in the short run, whereas returns to scale can apply in the long run.
Diminishing marginal returns can lead to negative output, while returns to scale always result in increased output.
Diminishing marginal returns are linked only to labor inputs, while returns to scale consider both labor and capital.
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Diminishing Marginal Returns
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