Consider the following statements about the marginal product (MP) of a variable input:
(A) The MP curve cuts the AP curve from below at the maximum point of the AP curve.
(B) MP is undefined at zero level of input employment.
(C) Total product at any level is the sum of the MPs of every preceding unit.
(D) The MP curve is ‘U’-shaped because of the law of variable proportions.
(E) The MP of the Lth unit equals the TP at L units minus the TP at L – 1 units.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → (B), (C) and (E) only
MP is the change in TP from one more unit of the input. It first rises and then falls.
(A) The MP curve cuts the AP curve from below at the maximum point of the AP curve. — Incorrect. MP is above AP while AP rises, so the MP curve cuts AP from above.
(B) MP is undefined at zero level of input employment. — Correct. Inputs cannot be negative, so there is no unit before zero to compare with.
(C) Total product at any level is the sum of the MPs of every preceding unit. — Correct. Each MP is what one unit adds, so they add up to TP.
(D) The MP curve is ‘U’-shaped because of the law of variable proportions. — Incorrect. MP first rises and then falls, so its curve is inverse ‘U’-shaped.
(E) The MP of the Lth unit equals the TP at L units minus the TP at L – 1 units. — Correct. This is how MP is worked out.
NCERT (2026-27): “3.3.3 Marginal Product … Values in this column are obtained by dividing change in TP by change in L. For example, when L changes from 1 to 2, TP changes from 10 to 24. MPL= (TP at L units) – (TP at L – 1 unit) Here, Change in TP = 24 -10 = 14 Change in L = 1 Marginal product of the 2nd unit of labour = 14/1 = 14” “3.3.3 Marginal Product … Since inputs cannot take negative values, marginal product is undefined at zero level of input employment. For any level of an input, the sum of marginal products of every preceeding unit of that input gives the total product. So total product is the sum of marginal products.” “3.5 Shapes of Total Product, Marginal Product and Average Product Curves … According to the law of variable proportions, the marginal product of an input initially rises and then after a certain level of employment, it starts falling. The MP curve therefore, looks like an inverse ‘U’-shaped curve as in figure 3.2.” “3.5 Shapes of Total Product, Marginal Product and Average Product Curves … As long as the AP increases, it must be the case that MP is greater than AP. Otherwise, AP cannot rise. Similarly, when AP falls, MP has to be less than AP. It, follows that MP curve cuts AP curve from above at its maximum.” |