Marginal Product and Average Product Curves    Marginal Product diminishes after the 3rd worker is hired, causing the MP curve to become negatively sloped to the right of the 3rd worker.

   Notice that MP and AP intersect at the maximum of the AP curve. As is the case when we graph any average quantity along with the same marginal quantity the average is rising when marginal exceeds average and the average is falling when marginal is less than average.

Copyright © 1995-2004 OnLineTexts.com, Inc. - All Rights Reserved