Q:
What is the formula for finding the marginal product?
A:
Quick Answer
Marginal Product, or MP, is the change in Total Product, or TP. It results from the use of one more (or less) unit of labor, or L. Thus, the formula to find the marginal product is MP=change in TP/ change in L.
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Full Answer
The marginal product is the change in the production output resulting from a change in a production input. When companies calculate the marginal product, they must hold all factors, with the exception of the increase in units of labor, constant. This means that only the units of labor change and other factors, such as property, plants and equipment available for production, remain the same.
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