Investor Glossary-diminishing returnInvestor Glossary-diminishing returnInvestor Glossary-diminishing returnInvestor Glossary-diminishing returnInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Diminishing Return

The HTML to link to this page
 

Diminishing return, or the law of diminishing return, is an economic tenet, which provides that adding additional units of productivity beyond a certain threshold will incrementally regress production returns. The law of diminishing return is a product of Europe at the turn of eighteenth century, where it was put forth toward free trade and agriculture. In a broad sense, the law of diminishing return states that employing additional workers may initially increase productivity. However, after a certain point adding new units of labor will result in diminishing return. This means that, adding each new worker will create marginal diminishing return, which at some point may even lead to the overall diminishing return of the entire production facility. If all other facets of production remain the same, diminishing return is typically brought on by the overpopulation of the labor force. Diminishing return may also be associated with the hiring of less than adequately skilled resources.



Rate this diminishing return definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: in escrow, wholly-owned subsidiary, risk management, phantom income, class C shares, deferred tax, minority interest, 1031 exchange, command economy, stock market close, VIX, 144a, average price per share, cancelled check, deferred revenue, 401a, 1035 exchange, EBITDA, required rate of return, debt service coverage, option premium, current ratio, margin rate, open position, limit order, reverse mortgage, FICO score, Zero Cost Collar, covered put, ex-dividend, FTSE, real GDP, liquidity ratio, LIBOR, labor relations, balance sheet, implied volatility, Key Rate Duration, irrevocable trust, diluted share, quality assurance, retained earnings, stock split, inflation, APR, ex-dividend date, dividends payable, annual return, per diem


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use