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Give the behaviour of marginal product and total product as more and more units of only one input are employed while keeping other inputs as constant. |
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Answer» When only one input is increased and other inputs are held constant, Law of Variable Proportions will be applicable. According to Law of Variable Proportions, total production increases initially at an increasing rate, and finally at diminishing rate. There are three stages of the law : 1. Total product increases at an increasing rate i.e., marginal product increases. 2. Total product increases at diminishing rate i.e., marginal product decreases. 3. Total product starts falling i.e., marginal product decteases and becomes negative. It may be shown as under :
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