The marginal product curve is above the average product curve when the average product is:a)Increasingb)Decreasingc)Constantd)NoneCorrect answer is option 'A'. Can you explain this answer?

Question

Answer

Correct answer is option (A) Increasing

Marginal Product Curve and Average Product Curve
- Marginal Product (MP): It refers to the change in total product when one more unit of a variable input, usually labor, is added.
- Average Product (AP): It is the total product divided by the number of units of the variable input used.

When Average Product is Increasing

- The marginal product curve is above the average product curve when the average product is increasing.
- This is because when the marginal product is higher than the average product, adding more units of the variable input will result in an increase in the average product.
- In this scenario, each additional unit of input contributes more to the total product than the previous unit, causing the average product to rise.

Answer

The MPC is above because increasing rate of MPC is much more than the APC.

Answer

Marginal product and average product are two important concepts in production theory. Marginal product refers to the change in output resulting from a one-unit increase in input, while average product refers to the output per unit of input.

The relationship between marginal product and average product can help us understand the behavior of production functions. In particular, when the marginal product curve is above the average product curve, it indicates that the average product is increasing.

Explanation:

When the marginal product curve is above the average product curve, it means that the additional output resulting from an additional unit of input is greater than the average output per unit of input. This occurs when the marginal product is increasing and is greater than the average product.

This can be illustrated with the help of a production function. Let's say that a company produces widgets and employs workers to produce them. The production function can be expressed as follows:

Q = f(L)

Where Q is the quantity of widgets produced, L is the quantity of labor employed, and f() is the production function.

If we plot the marginal product and average product curves for this production function, we can see that the marginal product curve intersects the average product curve at its maximum point. This is because the marginal product is equal to the average product at this point.

If the marginal product is increasing, it means that each additional unit of labor is contributing more to the production of widgets than the previous unit of labor. This results in a higher marginal product curve. At the same time, the average product curve is also increasing because the output per unit of input is increasing. However, the marginal product curve is always above the average product curve when the average product is increasing.

Conclusion:

In conclusion, the marginal product curve is above the average product curve when the average product is increasing. This occurs when the marginal product is increasing and is greater than the average product. This relationship is important for understanding the behavior of production functions and can help firms optimize their production processes.

Answer

Because when average product increases marginal product also increases but the rate of increase of marginal product is greater then the rate of increase of average product....

Answer

A

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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

If the marginal product of labour is below the average product of labour. It must be true that

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