Question

Explain law of variable proposition with the help of total product and marginal product?

Answer 1

Law of variable proposition:-

• This is a situation in which we study behaviour of product when more and more units of variable factor applied along with fixed factor.

• In short period according to this law of more and more units of a variable factor applied by a fixed factor, total product increase at increasing rate at beginning, increase at diminishing rate and finally decline.

Assumption of law:-

1. Production function is variable proportion types.

2. Units of variable factor are homogeneous or equally efficient.

3. Technique of production doesn't changes.

4. Some more factors are fixed so that output can be increasing the application of variable factors.