when would we say that the relationship between two variables x and y is spurious
Spurious relationship In statistics, a spurious relationship or spurious correlation[1][2] is a mathematical relationship in which two or more events or variables are not causally related to each other, yet it may be wrongly inferred that they are, due to either coincidence or the presence of a certain third, unseen factor (referred to as a "common response variable", "confounding factor", or "lurking variable").
Diminishing returns The law of diminishing returns states that in all productive processes, adding more of one factor of production, while holding all others constant ("ceteris paribus"), will at some point yield lower incremental per-unit returns.[1] The law of diminishing returns does not imply that adding more of a factor will decrease the total production, a condition known as negative returns, though in fact this is common.