Concept of production function and its types

Today we will discuss about concept of production function and its types. It is the functional relationship between physical input and physical output of a commodity.

               QX=f (L, K)

30X=f (2L, 10K)

According to it 30 units are produced using 2 units of labour and 10 units of capital. By implying more units of labour say 4 units and 20 units of capital the output could be increased to 60 units.

60X=f (4L, 20K)

Types of production function:

Short Run Production Function: In short run production function one factor of production remains constant and one factor of production changes. As in short run we can make changes in labour only the other factor that is capital remains constant as in short period we cannot immediately make changes in the capital only labour can be changed.

                            __

              QX=f (L, K)

                                 __

60X=f (4L, 20K)

Long Run Production Function: In long run production function all factors of production changes. As in long run we can make changes in labour as well as the other factor that is capital also. So in long run all factor of production are variable. Output can be increased by increasing all the factors of production.

QX=f (L, K)

30X=f (2L, 10K)

This is all about concept of production function and its 2 types that are short run and long run production function.

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