Concept of Total, Average and Marginal Product
What is Total Product (TP)?
Total product refers to the total quantity of goods produced at a particular time as a result of the use of all the factors of product. Total product depends mainly on the quantity of all the factors of production that are applied in production.
TP = AP x Labour
What is Average Product (AP)? Average product refers to total product divided by the number of variable factor of production – labour. It is therefore per unit product produced by each labourer or worker.
What is Marginal Product (MP)?
This is the additional product produced as a result of the application of one additional unit of variable factor when all other factor are fixed. That is, increase in total product as a result of the employment of one additional unit of product.
Click here to download “Concept of Total, Average and Marginal Product” as PDF.
Click here to save this Post as PDF
