What will you say about MPP of a factor when TPP rises at diminishing rate?

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Solution

MPP falls but remains positive.

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The following table gives the MPP of a factor. It is also known that the TPP at zero level of labour is zero. Determine its TPP and APP schedules.

$\begin{matrix} Units of labour & 1 & 2 & 3 & 4 & 5 & 6 Employment MPP & 50 & 110 & 150 & 180 & 180 & 150 \end{matrix}$

Calculate the APP and MPP of a factor from the following table of its TPP schedule :

$\begin{matrix} Level of Factor & 0 & 1 & 2 & 3 & 4 & 5 & 6 & 7 Employment TPP & 0 & 5 & 12 & 20 & 28 & 35 & 40 & 42 \end{matrix}$

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