The reason the short-run marginal cost curve eventually increases as output increases for a typical firm is because

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The question asks why the short-run marginal cost curve eventually increases as output rises for a typical firm.
Option 1: 'of positive returns to scale' — This concept deals with long-run production where increasing all inputs leads to greater than proportional increases in output; it does not explain the shape of the short-run marginal cost curve, which is driven by input constraints in the short run. Therefore this is not the right cause of rising short-run MC.
Option 2: 'of diseconomies of scale' — Diseconomies of scale refer to rising average costs as output grows in the long run due to inefficiencies from scaling up the firm; it is not the mechanism behind increasing marginal costs in the short run where only one or a few inputs are fixed. Hence this is not the correct explanation for the short-run MC rise.
Option 3: 'of minimum efficient scale' — The minimum efficient scale is the output level at which long-run average costs are minimized; it concerns long-run cost structure rather than the immediate cause of rising marginal cost in the short run. It does not account for the increasing marginal cost curve, so this option is incorrect.
Option 4: 'of the law of diminishing returns' — In the short run, at least one input is fixed (like capital), so adding more of the variable input (like labor) eventually yields smaller increases in output (diminishing marginal product). To produce each additional unit, more input is needed, which raises the marginal cost. This directly explains why the MC curve slopes upward as output increases in the short run. Thus this is the correct explanation.

The reason the short-run marginal cost curve eventually increases as output increases for a typical firm is because

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