Question
Explain the relationship between Marginal product and Average product.
OR
State the relation between Marginal product and average product. Use diagram.✓
Answer
- Average Product increases as long as Marginal Product (MP) > Average Product (AP). Alternatively, when MP > AP, AP rises.
- Average Product is maximum and constant when Average Product (AP) = Marginal Product (MP). Alternatively, when AP = MP, AP is maximum.
- Average Product falls when Marginal Product < Average product.
- Marginal Product can be zero and negative but Average product is never zero.
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