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# What do you understand by stages of production in Forestry? Explain total product, average physical product & Marginal physical product.

## What do you understand by stages of production in forestry?  Explain total product, average physical product & Marginal physical product.

In the short run, the law of variable proportions represents three different stages of production process carried out by a firm. According to this law “As the quantity of one variable input in a production process is increased with quantities of other inputs remaining fixed, marginal physical product firstly increases, then after reaching a maximum start decreasing and finally becomes negative”.
Stage of increasing returns. The 1st stage is popularly called the stage of increasing returns. In this stage total product rises initially at an increasing rate. Marginal Product rises first & then fall but remains greater than the Average product. The average product and marginal product rises throughout at this stage.

Stage of diminishing return. It is the most important stage in the production function. In this stage, total production continues increases at a diminishing rate until it reaches its maximum. In this stage, both the marginal product & average product are decreasing but are positive.

Negative return. In the 3rd stage, the total product declines. The total product curve slopes downward. A producer cannot operate at this stage because total production declines with the employment of additional labor. A rational producer will always produce in stage where marginal product and average product of the variable factor are diminishing.
Production with one variable input
 Fixed input Variable input Total product (TP) Tons of wheat Marginal (M.P) product Average Product (AP) 10 1 4 4 4.0 10 2 11 7 5.5 10 3 20 9  Stage I 6.6 10 4 30 10 7.5 10 5 39 9 7.8 10 6 46 7 7.6 10 7 50 4  Stage II 7.1 10 8 50 0 6.2 10 9 45 – 5  Stage III 5.0

Up to 4th worker the marginal physical product (MP) is increasing i.e. every new worker is adding more the total product (TP) than the previous one. This stage is called increasing return.

The MP of 5th worker is less than that of 4th. Thus from this point, law of decreasing returns start.

Finally at 8th worker MP is Zero and it becomes negative from 9th worker. During stage one up to OA average product is increasing. In stage III or OB, marginal product is Zero and Total product is falling. The firm has one choice only, that  it must produce somewhere in stage II where marginal product is falling but is positive.

Total Product.  It is the total quantity of output which is produced by the combination of the factor of production. e.g. if the firm produces 100 chairs per week. It will be the total product of that firm.

Average physical product: Total Product divided by units of variable factor determines the average product. If 10 labor produces 100 chairs per week. The average physical product of labor will be 100/10 =10 chairs.

Marginal Physical product. A change in the total product which is brought about by an additional unit of variable factor employed in the production process is called marginal physical product e.g 10 labor in a firm produces 100 chairs per week and if 11 labor is employed, the total output of chairs goes up 110. Thus T. output increases by 10 chairs on the employment of 11th labor. So the M.P.P of 11th labor is 10 chair.
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