In addition, this concept of production function gives us concepts of ‘average product’ (AP) and ‘marginal product’ (MP) or marginal physical product (MPP) or incremental product. A firm increases its level of production in the short run by making changes in input- mix.

Average product (AP), also called average product of labor (APL), is total product (TP) divided by the total quantity of labor. It is the average amount of output each worker can produce. The average product curve and marginal product (MP) curve intersect at the maximum average product.

Divide the total product by the input of labor to find the average product. For example, a factory that produces 100 widgets with 10 workers has an average product of 10. Average product is useful for defining production capabilities at a specific level of input.

What Is Average Product? The term average product refers to the average output (or products) produced by each input (factors of production like labor and land). In our example, it’s the average number of tents produced by each worker.

Marginal product focuses on the changes between production totals and the quantity of resources. Average product shows output at a specific level of input. The marginal product (MP) curve crosses the average product (AP) curve at the point where the average product curve is at a maximum.

It refers to the total amount of output that a firm produces within a given period, utilising given inputs. It is output per unit of inputs of variable factors. Average Product (AP)= Total Product (TP)/ Labour (L). It denotes the addition of variable factor to total product.

Total product is the total amount produced per a set of resources, average product is the average cost per unit produced per set of resources, and marginal product is the cost for the very next unit to be produced in resources.

Average product. Average product of a variable input is the total output produced with a particular quantity of the variable input divided by the quantity of the variable input.

It refers to the total amount of output that a firm produces within a given period, utilising given inputs. It is output per unit of inputs of variable factors. Average Product (AP)= Total Product (TP)/ Labour (L).

AP = Total Product/ units of variable factor input = TP/L. Note that Total Product can also, therefore, be calculated as TP = AP x L.

TP is also known as ‘Total Physical Product (TPP)’ or ‘Total Return’ or ‘Total Output’. Average product (AP) refers to output per unit variable input. For example, if TP is 60 kg of rice, produced by 10 labourers (variable input), then AP will be 60/10 = 6 kg.

It is output per unit of inputs of variable factors. Average Product (AP)= Total Product (TP)/ Labour (L). It denotes the addition of variable factor to total product. Thus, Marginal product= Changed output/ changed input.

Average Product. Average product equals the units of output produced per unit of a factor of production while keeping other factors of production constant.

The average is defined as the mean value which is equal to the ratio of sum of number of a given set of values to the total number of values present in the set. The average formula has many applications both in real-life.

One of the common uses of the term value is as mean value. Mean value is the average of a set of numbers divided by the number of numbers in the set.

In mathematics and statistics, average refers to the sum of a group of values divided by n, where n is the number of values in the group. An average is also known as a mean . Like the median and the mode, the average is a measure of central tendency, meaning it reflects a typical value in a given set.