Why does an oven plug burn out when all knobs are on full-setting?
If a fuse burns out when too much current is flowing through it, then how does turning on all knobs to their full setting burn out the wall-plug?


Turning on more rings will draw more current (in the same way that turning on more water taps will draw more water current). If the wall-plug burns out then it is inadequate for the job.


  Shouldn't turning on all knobs increase resistance as you're adding more components to the circuit? 


No. Turning on more cooker rings adds more resistors in  parallel and that decreases reseistance.







simulate this circuit &ndash; Schematic created using CircuitLab

Figure 1. Switching on additional heaters adds resistance in parallel. This reduces the overall resistance allowing more current to flow from the mains supply.

To understand how the power setting knobs work see my answer to 
Setting heat on electric stove.