Question 17 of 31intermediate🔧 ApplyNumerical4 marks

The following table gives the average product schedule of labour. Find the total product and marginal product schedules. It is given that the total product is zero at zero level of labour employment.

LLAPLAP_L
12
23
34
44.25
54
63.5
Correct Answer

Total Product Schedule:

LAP_LTP_L
0-0
122
236
3412
44.2517
5420
63.521

Marginal Product Schedule:

LTP_LMP_L
00-
122
264
3126
4175
5203
6211
Exercise: EXERCISES | Q: 23 | (Chapter: 16)
For More Understanding

Explanation

This question tests the relationship between Average Product (AP), Total Product (TP), and Marginal Product (MP). The textbook defines AP_L = TP_L / L, which means TP_L = AP_L × L. Marginal Product is defined as the change in TP per unit change in labour, calculated as MP_L = TP at L units - TP at (L-1) units. Since TP is zero at zero level of employment, we use TP_0 = 0 as the starting point.

Solution Steps

  1. Step 1: Calculate Total Product using the formula TP_L = AP_L × L

  2. For L=1: TP = 2×12 \times 1 = 2

  3. For L=2: TP = 3×23 \times 2 = 6

  4. For L=3: TP = 4×34 \times 3 = 12

  5. For L=4: TP = 4.25×44.25 \times 4 = 17

  6. For L=5: TP = 4×54 \times 5 = 20

  7. For L=6: TP = 3.5×63.5 \times 6 = 21

  8. Step 2: Calculate Marginal Product using MP_L = TP_L - TP_(L-1)

  9. MP at L=1: 2 - 0 = 2

  10. MP at L=2: 6 - 2 = 4

  11. MP at L=3: 12 - 6 = 6

  12. MP at L=4: 17 - 12 = 5

  13. MP at L=5: 20 - 17 = 3

  14. MP at L=6: 21 - 20 = 1

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