CBSE Class 12-commerce Answered
Explain the relationship between AP and MP.
Asked by Topperlearning User | 25 Apr, 2016, 01:39: PM
Expert Answer
Here the table and the diagram below shows the following relationship between AP and MP:
• AP increases as long as MP is greater than AP. Till the point p, AP is at maximum.
• AP decreases when MP < AP. Beyond the point p, AP is at its top.
• AP is at its maximum when AP = MP. MP curve cuts AP from above at its maximum.
• MP may be zero or negative, but AP remains positive.
Units of Fixed Factor |
Units of Variable Factor |
AP |
MP |
1 |
0 |
0 |
0 |
1 |
1 |
4 |
4 |
1 |
2 |
10 |
16 |
1 |
3 |
16 |
28 |
1 |
4 |
17 |
20 |
1 |
5 |
16 |
10 |
1 |
6 |
14 |
4 |
1 |
7 |
12 |
0 |
1 |
8 |
1 |
-4 |
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