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The marginal, average, and total product curves encountered by the firm producing in the short run exhibit all of the following relationships except:
- a)when total product is rising, average and marginal product may be either rising or falling.
- b)when marginal product is negative, total product and average product are falling.
- c)when average product is at a maximum, marginal product equals average product, and total product is rising.
- d)when marginal product is at a maximum, average product equals marginal product, and total product is rising.
Correct answer is option 'D'. Can you explain this answer?
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The marginal, average, and total product curves encountered by the fir...
Explanation:
Marginal product (MP), average product (AP), and total product (TP) are important concepts in the theory of production. The relationship between these three curves can reveal important information about the efficiency of production.
a) When total product is rising, average and marginal product may be either rising or falling:
- Total product (TP) is the total output of a firm, which increases as more inputs are added.
- Average product (AP) is the output per unit of input, which may increase initially as more inputs are added, but eventually reaches a maximum and then declines.
- Marginal product (MP) is the additional output produced by adding one more unit of input, which may increase initially as more inputs are added, but eventually reaches a maximum and then declines.
Therefore, when TP is rising, AP may be rising or falling, depending on whether the additional inputs are adding more or less than the average output per unit of input. Similarly, MP may be rising or falling, depending on whether the additional input is adding more or less than the previous unit.
b) When marginal product is negative, total product and average product are falling:
- When MP is negative, it means that the additional input is decreasing the overall output of the firm, which leads to a decline in TP.
- Since AP is calculated as TP divided by the number of inputs, it will also decline when TP is falling.
c) When average product is at a maximum, marginal product equals average product, and total product is rising:
- AP reaches a maximum when the additional input is adding the most output per unit of input, which means that MP equals AP at this point.
- This also means that the firm is producing at the most efficient level, and TP is rising as more inputs are added.
d) When marginal product is at a maximum, average product equals marginal product, and total product is rising:
- This statement is incorrect because it implies that MP is at a maximum when AP is equal to MP, which is not true.
- MP reaches a maximum when the additional input is adding the most output, which may occur at a different point than when AP is at a maximum.
- However, when MP is at a maximum, it does indicate that the firm is producing at the most efficient level, and TP is rising as more inputs are added.
Therefore, the correct answer is option D, as it does not accurately describe the relationship between MP, AP, and TP.
Marginal product (MP), average product (AP), and total product (TP) are important concepts in the theory of production. The relationship between these three curves can reveal important information about the efficiency of production.
a) When total product is rising, average and marginal product may be either rising or falling:
- Total product (TP) is the total output of a firm, which increases as more inputs are added.
- Average product (AP) is the output per unit of input, which may increase initially as more inputs are added, but eventually reaches a maximum and then declines.
- Marginal product (MP) is the additional output produced by adding one more unit of input, which may increase initially as more inputs are added, but eventually reaches a maximum and then declines.
Therefore, when TP is rising, AP may be rising or falling, depending on whether the additional inputs are adding more or less than the average output per unit of input. Similarly, MP may be rising or falling, depending on whether the additional input is adding more or less than the previous unit.
b) When marginal product is negative, total product and average product are falling:
- When MP is negative, it means that the additional input is decreasing the overall output of the firm, which leads to a decline in TP.
- Since AP is calculated as TP divided by the number of inputs, it will also decline when TP is falling.
c) When average product is at a maximum, marginal product equals average product, and total product is rising:
- AP reaches a maximum when the additional input is adding the most output per unit of input, which means that MP equals AP at this point.
- This also means that the firm is producing at the most efficient level, and TP is rising as more inputs are added.
d) When marginal product is at a maximum, average product equals marginal product, and total product is rising:
- This statement is incorrect because it implies that MP is at a maximum when AP is equal to MP, which is not true.
- MP reaches a maximum when the additional input is adding the most output, which may occur at a different point than when AP is at a maximum.
- However, when MP is at a maximum, it does indicate that the firm is producing at the most efficient level, and TP is rising as more inputs are added.
Therefore, the correct answer is option D, as it does not accurately describe the relationship between MP, AP, and TP.
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The marginal, average, and total product curves encountered by the firm producing in the short run exhibit all of the following relationships except:a)when total product is rising, average and marginal product may be either rising or falling.b)when marginal product is negative, total product and average product are falling.c)when average product is at a maximum, marginal product equals average product, and total product is rising.d)when marginal product is at a maximum, average product equals marginal product, and total product is rising.Correct answer is option 'D'. Can you explain this answer?
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