GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Total production will be maximum when
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Marginal production is zero
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Average production is maximum
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Marginal production is maximum
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Average production is equal to the marginal production
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Explanation:
Detailed explanation-1: -Marginal Product is the defined as the change in total product resulting from one additional unit of a variable factor. For output to be maximized the marginal product should be 0. As if marginal product ≥ 0 it is profitable to increase production. If marginal product ≤ 0 it is profitable to decrease production.
Detailed explanation-2: -Point of inflexion is the point where the slope of the TP curve reaches the maximum and starts decreasing. At this point, MP is maximum.
Detailed explanation-3: -When marginal product of a factor is zero then total product will be maximum.
Detailed explanation-4: -When the total product (TP) is at its maximum level, then marginal product is zero.
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