(a) Draw the total product (TP) and marginal product in one diagram (MT).
(b) Explain the relation between TP and MT.
(a) To draw the total product (TP) and marginal product (MP) in one diagram, you will need a two-axis graph. The x-axis represents the quantity of input, while the y-axis represents the level of output.
1. Start by plotting the TP. To do this, you need data on the quantity of input and the corresponding level of output. For each level of input, calculate the total output produced. Then, plot these points on the graph.
2. Next, plot the MP. To calculate the MP, find the change in output resulting from a change in the quantity of input. Divide this change by the change in input to determine the marginal product. Plot these MP points on the graph.
(b) The relationship between TP and MP is positive and interconnected.
1. Initially, as the quantity of input increases, the TP also increases at an increasing rate. For example, when a firm hires more workers, production increases rapidly due to division of labor and increased specialization. This is reflected in the upward slope of the TP curve.
2. The MP curve is related to the TP curve. It represents the additional output generated by employing one more unit of input. MP starts at its peak when TP starts to increase at an increasing rate. As more units of input are added, MP gradually diminishes because of diminishing returns to the variable input.
3. The TP curve reaches its maximum point when MP is zero. After this point, MP becomes negative, indicating that each additional unit of input leads to a decrease in output. This reflects the diminishing marginal returns in production.
Overall, the TP curve shows the total output produced at different levels of input, while the MP curve illustrates the additional output generated by employing each additional unit of input. Understanding this relationship helps firms optimize their production process and determine the most efficient level of input to achieve maximum output.