The marginal product measures the change in output when one more unit of input is added, while the average product measures the total output divided by the total input. The marginal product is important for determining the efficiency of production at the margin, while the average product gives an overall picture of efficiency.
Marginal and Average productivity increases when technological innovations are introduced into production process.
marginal cost
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efficiency in allocation will be less
Marginal cost comes from the costs of producing just one more of something.
Marginal and Average productivity increases when technological innovations are introduced into production process.
marginal cost
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Marginal product is any input in the production process is the increase in the quantity of output obtained from on additional unit of the input. Average product is the output produced when one more unit of the variable factor is employed The relationship is state as: If labour's marginal product is exceed its average product that means labour's average product will be rising. Labour's average product will be falling. If labour's marginal product is less than its average product. If labour's marginal product is equal its average product and the average product will reach the minimum value at the point.
efficiency in allocation will be less
Marginal cost comes from the costs of producing just one more of something.
When marginal cost is equal to average total cost, it means that the cost of producing one more unit is the same as the average cost of all units produced. This indicates that the firm is operating at its most efficient level of production.
Average and marginal productivity are analytical tools used to measure the output of labor in order to evaluate current production ability and improve future capacity. Average productivity is the total production involved in a process divided by the number of variable unit inputs employed. It is what each employee produces. Marginal productivity is the increase in the rate of output created by adding one more unit of the input while maintaining the same constant inputs.
relation ship between average cost and marginal cost
On the margin means looking at the next unit of something. For example, when considering business decisions, you might consider the marginal cost of an additional unit of production, or the marginal revenue. (Rather than the average revenue, for instance.)
On the margin means looking at the next unit of something. For example, when considering business decisions, you might consider the marginal cost of an additional unit of production, or the marginal revenue. (Rather than the average revenue, for instance.)
Marginal Cost will keep increasing (have upward slope) because of the principle of diminishing marginal returns. The MC curve above the its intersection with AVC is the Supply Curve *because below minimum AVC, the firms stops production)