Dominick Salvatore Schaums Outline of Microeconomics, 4th edition Schaums Outline Series 2006

CHAP. 6] THEORY OF PRODUCTION 119
The TP, AP L , and MP L schedules of Table 6.1 are plotted in Fig. 6-1. Since the MP L has been defined as the change in
TP per unit change in the quantity of labor used, each value of the MP L has been recorded in panel B halfway between the
quantities of labor used.
6.2 THE SHAPES OF THE AVERAGE AND MARGINAL PRODUCT CURVES
The shapes of the AP L and MP L curves are determined by the shape of the corresponding TP curve. The
AP L at any point on the TP L curve is given by the slope of the straight line from the origin to that point on the TP
curve. The AP L curve usually rises at first, reaches a maximum, and then falls, but it remains positive as long as
the TP is positive.
Fig. 6-1
The MP L between two points on the TP curve is equal to the slope of the TP curve between the two points.
The MP L curve also rises at first, reaches a maximum (before the AP L reaches its maximum), and then declines.
The MP L becomes zero when the TP is maximum and negative when the TP begins to decline. The falling
portion of the MP L curve illustrates the law of diminishing returns.