2. refers to the time frame in which the
input of one or more productive agents
is fixed.
3. Total Product(TP)- is the total quantity , or
output, of a particular good produced.
- amount of output produced in physical units
such as bags of fertilizer, bottles of vinegar
or pair of shoes or slippers.
4. Marginal Product (MP) is the extra output or
added product associated with adding a unit
of a variable resource.
Marginal product = change in total product
change in quantity of
variable inputs
5. Average product (AP)- output per unit of
resources employed.
Average= total product_____
quantity of variable inputs
6. Number of workers Total Output per
day
Average
product
Marginal product
1 50 bars 50 bars
2 125 62.5 75
3 220 73.3 95
4 320 80 100
5 410 82 90
6 490 81.6 80
7 560 80 70
8 610 76.2 50
9 640 71 30
10 630 63 -10
7. as we add more units of a variable input to
fixed amounts of capital, the change in total
output will at first rise and then fall.
Diminishing returns to labor occurs
when marginal product of labor starts to fall.
This means that total output will be increasing
at a decreasing rate.
8.
9.
10. 1.When MP lies above AP, AP rises.
2.When MP lies belowAP, AP falls.
3.MP intersectsAP at its maximum value
4.When MP crosses the X-axis, it signifies a
move from diminishing marginal returns to
negative marginal returns.
