Question: As additional units of variable input are added to a fixed input, at some point the additional output (marginal product) resulting from this addition starts to diminish.

Another way to consider this law is to recognize that when it takes effect, a firm has to add increasingly more of the variable input in order to increase the additional output by a constant amount. Note that this is because the fixed input is essentially becoming scarce relative to the variable input.

This law is considered a short-run phenomenon in economic theory because it requires at least one of the inputs used by the firm to be held constant.

Can somebody offer an example of this law in action?