AVERAGE PRODUCT: The quantity of total output produced per unit of a variable input, holding all other inputs fixed. It is found by dividing total product by the quantity of the variable input. Average product, abbreviated AP also goes by the alias of average physical product (APP), so don't be confused by the extra term (physical). Compare this term with marginal product and average revenue product when you have a chance. If you haven't yet come across the term, then you really should spend some time with the law of diminishing marginal returns. The average-marginal rule is also worth a look.

     See also | total product | variable input | fixed input | average physical product | average revenue product | total revenue | marginal productivity theory | factor markets | marginal physical product | marginal physical product | marginal revenue product | law of diminishing marginal returns |

AVERAGE PRODUCT, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2023. [Accessed: December 4, 2023].

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The notion that taxes are imposed on society in a fair and equitable way. The two standards of fairness and equity used to evaluate taxes are the benefit principle -- those who benefit from government pay the taxes, and the ability-to-pay principle -- those with the most income pay the taxes. The ability-to-pay principle gives rise to two additional notions of fairness -- horizontal equity (those with equal incomes pay equal taxes) and vertical equity (those with different incomes pay different taxes).

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