As a firm adds additional workers to its fixed capital, the marginal product of labor typically . (Insert a single word.)

The correct word to complete the sentence is "diminishes".

As a firm adds additional workers to its fixed capital, the marginal product of labor typically diminishes due to the principle known as diminishing marginal returns. This economic concept suggests that when one input in a production process is increased while other inputs remain fixed, the additional output produced from each new unit of that input will eventually decrease after a certain point. Initially, adding more workers may lead to increased efficiency and higher output because they can collaborate and operate more machinery. However, as more workers are added, they may start to crowd each other, and the fixed capital may become over-utilized, resulting in less effective contributions from each successive worker. Consequently, each new worker contributes less to total production than their predecessor, illustrating the diminishing marginal product of labor.