Comprehensive and Detailed Explanation From Exact Extract:

SRE applies economic principles, including diminishing marginal returns, to reliability engineering. As per the SRE Book: “Improving reliability becomes more expensive as the target approaches 100%, moving from increasing returns, to diminishing returns, and eventually negative returns.” (SRE Book – SLO Economics). This framework helps explain why striving for 100% availability is impractical and cost-ineffective.

The three recognized stages are:

Increasing returns – early improvements are inexpensive and highly impactful

Diminishing returns – costs rise while benefits shrink

Negative returns – achieving additional “nines” may reduce value due to slowed innovation

“Possible returns” is not part of this model.

Thus, D is the correct answer.