Which of the following statements accurately reflect the implications of diminishing marginal returns in production? Select all that apply.

Diminishing marginal returns occur when adding more of one input, like labor, to a fixed amount of another input, like machinery, results in smaller increases in output. For example, if a factory has one machine and you keep adding workers, each new worker will contribute less to total production than the previous one because they have less equipment to work with. This means that after a certain point, hiring more workers will not be as effective, and it could even lead to overcrowding. Understanding this concept helps businesses decide how many workers to hire to maximize efficiency without wasting resources. Therefore, recognizing diminishing marginal returns is important for making smart production choices.