Average product is per unit product of the variable factor. In other words, average product is obtained by dividing total product by the total units of variable factor used. Thus,**AP= TP/LWhere,AP= Average Product TP= Total ProductL= Labour **

Initially, AP increases at a slower rate , becomes maximum, and diminishes.

Average Product Curve

AP curve begins from the origin. As the units of variable factors are increased, it increases at a decreasing rate, reaches a maximum point, and the begins to decline. AP curve is inverted U-shaped. As long as TP is positive, AP is positive. It can be illustrated with the help of an AP schedule given in the table below:

Units of Labour(L) | Total Product(TP) | Average Product(AP) |

0 | 0 | 0 |

1 | 10 | 10 |

2 | 30 | 15 |

3 | 60 | 20 |

4 | 80 | 20 |

5 | 90 | 18 |

6 | 90 | 15 |

7 | 80 | 11.4 |

In the figure, units of labour are shown on the X-axis and average product on the Y-axis. AP increases up to the point A and it and it is stable at the point B. Thereafter, it declines. So, it takes an inverted U shape.

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