Introduction

After you have worked through this section of the learning unit, you should be able to:

  • present total product and marginal product with the aid of diagrams
  • describe the relationship between total product and marginal product

Total production

The following data about the production of Blaker Maker can be used to graphically illustrate the production function and law of diminishing returns.

To construct the production function, the total product or output is plotted on the vertical axis, while the number of labourers is plotted on the horizontal axis.

Production for Blaker Maker

Variable input
labour		 Total product (TP)
0 0
1 500
2 1 500
3 3 000
4 4 000
5 4 500
6 4 750
7 4 750
8 4 500

Joining the points gives us our production function for Blaker Maker.

If you look closely at the above graph of the production function for Blaker Maker, you will see that total production increases at an increasing rate until the third worker is employed. Thereafter total production continues to increase, but at a decreasing rate until the seventh worker is employed. It then starts to decline.