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When is average product at its maximum point?
- a)When AP intersects MP
- b)When AP intersects TP
- c)When MP is highest
- d)At the point of inflexion
Correct answer is option 'A'. Can you explain this answer?
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Most Upvoted Answer
When is average product at its maximum point?a)When AP intersects MPb)...
Explanation:
Average product (AP) refers to the output produced per unit of input, while the marginal product (MP) refers to the additional output produced when an additional unit of input is added.
The point where the average product is at its maximum is a crucial point for the firm since it indicates the optimum level of production, where the firm is operating at maximum efficiency.
When AP intersects MP:
At the point where AP intersects MP, the AP is at its maximum. This is because the MP curve intersects the AP curve at the point where the AP curve is at its maximum. This is because when the MP curve is higher than the AP curve, the AP curve is rising, and when the MP curve is lower than the AP curve, the AP curve is falling.
When AP intersects TP:
The point where AP intersects TP is not necessarily the point where AP is at its maximum. This is because AP is a function of the MP, and the MP may be increasing or decreasing at the point where AP intersects TP.
When MP is highest:
The point where MP is highest is not necessarily the point where AP is at its maximum. This is because AP is a function of the MP, and the MP may be increasing or decreasing at the point where MP is highest.
At the point of inflexion:
The point of inflexion is the point where the curvature of the TP curve changes from concave upwards to concave downwards. This point does not necessarily correspond to the point where AP is at its maximum.
Therefore, the correct answer is option 'A', when AP intersects MP.
Average product (AP) refers to the output produced per unit of input, while the marginal product (MP) refers to the additional output produced when an additional unit of input is added.
The point where the average product is at its maximum is a crucial point for the firm since it indicates the optimum level of production, where the firm is operating at maximum efficiency.
When AP intersects MP:
At the point where AP intersects MP, the AP is at its maximum. This is because the MP curve intersects the AP curve at the point where the AP curve is at its maximum. This is because when the MP curve is higher than the AP curve, the AP curve is rising, and when the MP curve is lower than the AP curve, the AP curve is falling.
When AP intersects TP:
The point where AP intersects TP is not necessarily the point where AP is at its maximum. This is because AP is a function of the MP, and the MP may be increasing or decreasing at the point where AP intersects TP.
When MP is highest:
The point where MP is highest is not necessarily the point where AP is at its maximum. This is because AP is a function of the MP, and the MP may be increasing or decreasing at the point where MP is highest.
At the point of inflexion:
The point of inflexion is the point where the curvature of the TP curve changes from concave upwards to concave downwards. This point does not necessarily correspond to the point where AP is at its maximum.
Therefore, the correct answer is option 'A', when AP intersects MP.
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When is average product at its maximum point?a)When AP intersects MPb)When AP intersects TPc)When MP is highestd)At the point of inflexionCorrect answer is option 'A'. Can you explain this answer?
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When is average product at its maximum point?a)When AP intersects MPb)When AP intersects TPc)When MP is highestd)At the point of inflexionCorrect answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about When is average product at its maximum point?a)When AP intersects MPb)When AP intersects TPc)When MP is highestd)At the point of inflexionCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for When is average product at its maximum point?a)When AP intersects MPb)When AP intersects TPc)When MP is highestd)At the point of inflexionCorrect answer is option 'A'. Can you explain this answer?.
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