Question

Explain the relationship between AP and MP.

Answer 1

Here the table and the diagram below shows the following relationship between AP and MP:

• AP increases as long as MP is greater than AP. Till the point p, AP is at maximum.
• AP decreases when MP < AP. Beyond the point p, AP is at its top.
• AP is at its maximum when AP = MP. MP curve cuts AP from above at its maximum.
• MP may be zero or negative, but AP remains positive.