Relationship between AP and MP

Relationship between AP and MP

The average product is per unit product of the variable factor. Marginal product is the change in the total product by the employment of an additional unit of the variable factor.

The relationship between AP and MP can be explained with the help of the following schedule and diagram:

Units of labor (L)

Total product (TP)

Average product (AP)

Marginal product (MP)

0

0

0

0

1

10

10

10

2

30

15

20

3

60

20

30

4

80

20

20

5

90

18

10

6

90

15

0

7

77

11

-13



AP-and-MP-relationship
From the above table and diagram, the relationship between AP and MP can be summarized as follows:
  1. When MP is greater than AP, AP increases at an increasing rate
  2. When MP is equal to AP, AP is at maximum.
  3. When MP is less than AP, AP starts to fall.
  4. MP may be positive, negative, or zero but AP is always positive
  5. When MP is rising, AP must rise but when MP is falling, AP may rise or fall.

Please leave your comment

If this article has helped you, please leave a comment.

Previous Article Next Article