The document discusses the relationship between the P-Q circle of a DG (distributed generation) unit and its P-f and Q-E droops. It presents the classic droop control scheme block diagram and equations that model how active power P and reactive power Q are related to frequency f and voltage magnitude E based on the droop coefficients. It also shows circuit diagrams for a droop controlled inverter connected to a microgrid and the structure for multiple parallel connected inverters.