Law of variable proportions is called as ___________.

Law of diminishing Marginal Product

The correct answer is Option 2: Law of diminishing Marginal Product

Law of variable proportions say that the marginal product of a factor input initially rises with its employment level. But after reaching a certain level of employment, it starts falling. This tendency of the MP to first increase and then fall is called the law of variable proportions or the law of diminishing marginal product.

Law of Diminishing Marginal Utility (Option 1) → Related to consumer behavior, not production.