Capital is held fixed. The marginal products of the first four units of labour are 5, 8, 11 and 9 units of output. Which of the following is NOT correct?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → The average product of 3 units of labour is 11 units.
Given:
MP of units 1 to 4 = 5, 8, 11, 9
TP is the sum of the marginal products, and AP = TP/L.
\( TP_3 = 5 + 8 + 11 = 24 \)
\( AP_3 = 24/3 = 8 \)
\( TP_4 = 24 + 9 = 33 \)
\( AP_4 = 33/4 = 8.25 \)
Option (1) The average product of 4 units of labour is 8.25 units. — True. AP4 = 8.25.
Option (2) The total product of 4 units of labour is 33 units. — True. TP4 = 33.
Option (3) The average product of 3 units of labour is 11 units. — False. AP3 is 8. 11 is the MP of the 3rd unit.
Option (4) The marginal product of labour at zero level of employment is undefined. — True. Inputs cannot be negative, so MP is undefined at zero.
NCERT (2026-27): “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.” “3.3.2 Average Product Average product is defined as the output per unit of variable input. … Values in this column are obtained by dividing TP (column 2) by L (Column 1). …” |