Question

Arrange the following statements in correct sequence with respect to the law of variable proportions:
(A) Initially total production increase at increasing rate
(B) When one input(variable) increases, keeping other inputs constant
(C) After reaching to its maximum level total products starts declining
(D) With the increase in variable input total product starts increasing at diminishing rate
Choose the correct answer from the options given below:

• A. (A), (B), (C), (D)
• B. (A), (B), (D), (C)
• C. (B), (A), (D), (C)
• D. (C), (B), (D), (A)

Hint:

Law of Variable Proportions stages:
1. TP increases at increasing rate (MP rises).
2. TP increases at diminishing rate (MP falls, MP \(> 0\)).
3. TP reaches maximum (MP \(= 0\)).
4. TP falls (MP \(< 0\)).

Answer 1

The Correct Option is C

Concept:
The Law of Variable Proportions (short-run production function) explains the behavioral pattern of total output when varying quantities of one input are combined with a fixed quantity of other factors.

Step 1: Analyzing the Stages of the Law:
- Initial Condition: The law begins under the operational condition where units of a variable factor are progressively increased while other factors remain fixed. This is statement (B).
- Stage I (Increasing Returns): Total Product (TP) initially expands at an increasing rate as specialization and efficiency of fixed factors improve. This is statement (A).
- Stage II (Diminishing Returns): Beyond a point, TP continues to increase but at a diminishing rate as the variable factor encounters capacity constraints. This is statement (D).
- Stage III (Negative Returns): Eventually, after reaching its absolute peak, excessive variable factor inputs cause TP to decline. This is statement (C).

Step 2: Formulating the Chronological Sequence:
Arranging these chronological phases yields: \[ \text{(B)} \rightarrow \text{(A)} \rightarrow \text{(D)} \rightarrow \text{(C)} \] Final Answer:
The correct order corresponds to option (C).