Average Product
Definition
Total output divided by units of a variable input. The shape of the average-product curve drives the U-shape of average cost.
Example
If 5 workers produce 100 widgets, average product of labor is 20.
Total output divided by units of a variable input. The shape of the average-product curve drives the U-shape of average cost.
If 5 workers produce 100 widgets, average product of labor is 20.