CONCEPTS OF TOTAL AVERAGE AND MARGINAL PRODUCTIVITY

           CONCEPTS OF TOTAL AVERAGE AND MARGINAL PRODUCTIVITY. Total Product (TP): Definition:

Total product is defined as the total quantity of commodities produced at a particular t result of the combination of all the factors of production.

Total product is expressed mathematically as:          TP =AP x Labour

Example

If 30 men were employed in a farm and produce an average of 15 tones of cassava j person, calculate the total product.

Solution

TP    =       AP x Labour

TP    =       15 tonnes x 30

=      450 tonnes

• Average Product (AP): Definition: Average product (AP) is defined as the output per unit of the variable factor (Labour or Capital) employed.
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This is obtained by dividing the total output by the number of labour or capital

AP can be expressed mathematically as:

AP =                   Total Product (Output)

No. of labour (or capital) employed

Example

If 3,000 tonnes of cassava were harvested by 60 men in a farm on daily basis, calculate the average output

AP              Total Output

                        No. of labour (men)

=          3,000 tonnes

     60men

            =          50tonnes/person

• Marginal Product (MP): Definition: the marginal product (MP) may be defined as the addition to total output brought about as a the employment of an additional unit of variable factor.

MP can be expressed mathematically as:

             Changes in TP

MP      =         Changes in variable factor

Example

If 2,080 tonnes of cassava were harvested from the same farm as a result of an additional man to the men, calculate the marginal product.

Solution

MP      =          (3,080 – 3,000)

                                 (61 – 60)

               =          80

                            1

   Mp       =          80 tonnes

 total product, average product and marginal product can be calculated using

 total Product, Average Product and Marginal Product.

No. of workers	Total Product (kg)	Average Product (kg)	Marginal Product (kg)
1 2 3 4 5 6 7	4 12 24 40 45 48 42	4 6 8 10 9 8 6	– 8 12 16 5 3 -6

           

RELATIONSHIP BETWEEN TOTAL PRODUCT, AVERAGE PRODUCT AND MARGINAL PRODUCT

The relationship between total produce average product and marginal product can best be demonstrated by a graph (Fig. 22.2 k. TP. AP and MP rise initially. TP rises sharply and curves at a maximum when MP is zero TP declines after MP = O and MP assumes negative value.

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