By adding all the marginal products at each lev... - WAEC Economics 2015 Question
By adding all the marginal products at each level of employment of the variable input, we obtain a value equal to
A
average product
B
total product
C
average variable cost
D
total cost
correct option: b
Total product is the overall quantity of output that a firm produces, usually specified in relation to a variable input. Total product is the starting point for the analysis of short-run production. It indicates how much output a firm can produce according to the law of diminishing marginal returns.
Marginal Product (MP) = Change in Total Product / Change in Variable Factor
Total Product (TP) = AP X Variable Factor
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