Total Product vs Marginal Product

Total Product is the total quantity of output produced by a firm using a given amount of inputs in a specific time period.

It increases as more variable inputs, like labor, are added to fixed inputs, like capital. Initially, total product rises at an increasing rate due to specialization, then at a decreasing rate due to diminishing returns.

Marginal Product is the additional output produced by adding one more unit of a variable input, holding all other inputs constant.

It is calculated as the change in total product divided by the change in the variable input. Marginal product typically rises at first due to increased efficiency, then falls due to the law of diminishing marginal returns.