What typically happens when more units of production factors are added?

When additional units of production factors, such as labor or capital, are added to a production process, the principle of diminishing marginal returns often comes into play. This means that as more units of a factor are added, the extra output generated by each additional unit starts to decline after a certain point. Initially, adding more workers may lead to an increase in total output, but there comes a moment when each new worker contributes less additional output compared to the previous one.

This phenomenon occurs because resources become limited, and each additional unit of the production factor can only be utilized effectively to a certain capacity before it starts to lead to overcrowding or inefficiencies. As a result, while total production might still increase, the rate of that increase diminishes, leading to decreasing additional output from the new units of production factors. This is aligned with the concept of diminishing marginal returns and is a fundamental aspect of production theory in economics.