What is diminishing marginal product?
Diminishing Marginal Product is the fact that the more a production input is added, the less that input will increase output. Eventually the added input will have no change on output, and then additional units will lower output.
Need a clear example for a boring and technical definition?
Here goes. Take a pizza restaurant.
Pizzas produced per hour is our output, and the number of employees will be the input we look at.
Want more pizzas produced?
Easy, hire a few more employees.
What if we hire 10 more? 20 more? 50 more?
You see the point?
Past a certain level, adding more employees will not result in more pizzas being made.
The kitchen is only so big and after a time, people will just start to get in each others way.