What is the general equation of an isoquant?
What is the general equation of an isoquant?
Isoquant – a curve that shows the efficient combinations of labor and capital that can produce a single (iso) level of output (quantity). Equation for an isoquant: q = f (L, K).
What is isoquant PDF?
An isoquant is a curve that shows the efficient combinations of labor and capital that can produce a single (iso)- level of output (quantity). Isoquants reflect the flexibility that a firm has in producing a given level of output in the long-run.
What is Isoquant and its types?
An isoquant is a curve showing all possible combinations of inputs physically capable of producing a given level of output. Ferguson. An isoquant curve may be defined as a curve showing the possible combinations of two variable factors that can be used to produce the same total product.
What do you mean by production functions?
production function, in economics, equation that expresses the relationship between the quantities of productive factors (such as labour and capital) used and the amount of product obtained. It can also be used to determine the cheapest combination of productive factors that can be used to produce a given output.
What is the y-isoquant of the production function?
The set of all pairs ( z 1, z 2) of inputs that yield the output y is the y – isoquant. Given the production function F , the y -isoquant is thus the set of all pairs ( z 1, z 2) for which y = F ( z 1, z 2 ). Isoquants may take a wide variety of forms.
What is an isoquant in economics?
An isoquant in economics is a curve that, when plotted on a graph, shows all the combinations of two factors that produce a given output. Often used in manufacturing, with capital and labor as the…
How do you find the output of an isoquant?
Along an isoquant output is constant, so the decrease in output caused by the decrease in z 1 must be exactly equal to the increase caused by the increase in z 2. That is, z 2 / z 1 = MP 1 /MP 2 . The ratio z 2 / z 1 is the absolute value of the slope of the isoquant, or the MRTS.
What is isoquant in production indifference curve?
Here, the term ‘isoquant’ can be cracked into ‘iso’ which implies equal and ‘quant’ that stands for quantity. The word altogether means the same volume or constant output at all points. The production indifference curve works based on diminishing marginal rate of technical substitution of the production factors.
