> A key assumption in my argument is that the marginal benefit of spending more time on an exam is always nonnegative

That is a very bold assumption, and I doubt the data supports it.

I couldn't find much published research on the correlation, just this one paper: https://journals.sagepub.com/doi/pdf/10.2304/plat.2009.8.2.5.... It shows no correlation between time on exams and final score, but its methodology is questionable.