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Part II: Considering Which Side You’re On in the Decision-Making Process in the average quantity of corn produced per acre of land, what farmers call yield, and economists call average product, or you may be interested in how much corn output increases when you plant one more acre, marginal product to economists. Each of these relationships is important, and each offers considerable insight into the production process. ✓ Total product refers to the entire quantity of output produced from a given set of inputs. In the equation, q represents total product. Therefore, if you plant 100 acres of corn, total product equals
or 11,357 bushels of corn produced. ✓ Average product refers to the output per unit of input. For a production function that has a single variable input, average product equals the total product divided by the quantity of input used. Therefore,
If you plant 100 acres of corn, the average product equals
or 113.57 bushels per acre. ✓ Marginal product is the change in total product that occurs when one additional unit of a variable input is employed. In Table 6-1, the marginal product of the 100th acre of land is 102 bushels of corn. The total product for 99 acres is 11,255 bushels, and the total product for 100 acres is 11,357 bushels. Thus, the difference or change between the two is 11,357 – 11,255 or 102 bushels of corn. Marginal product is also determined with calculus. To determine marginal product with calculus, take the following steps:
1. Take the derivative of total product with respect to the input. In the example, this is land (N).
