Question

Explain why Average Product must be increasing over the region of inputs where Marginal Product(MP) > Average Product(AP).

Answer 1

Marginal product of inputs can be defined as the change in the total output due to change in an additional unit of inputs.

Average product= Total product / labor

Since MP of labor is summation of all MP. Hence when MP is increasing, then it means TP will also increase, Hence the AP will also increases because AP is depended on the TP.

Hence it can be said that  Average Product must be increasing over the region of inputs where Marginal Product(MP) > Average Product(AP).