how to prove isoqouant is negative?
Answers
Step-by-step explanation:
An isoquant curve slopes downward, or is negatively sloped. This means that the same level of production only occurs when increasing units of input are offset with lesser units of another input factor.
Answer:
An isoquant curve slopes downward, or is negatively sloped. This means that the same level of production only occurs when increasing units of input are offset with lesser units of another input factor. This indicates that factors of production may be substituted with one another. This property falls in line with the principal of the Marginal Rate of Technical Substitution (MRTS). As an example, the same level of output could be achieved by a company when capital inputs increase, but labor inputs decrease. An isoquant curve, because of the MRTS effect, is convex to its origin. This indicates that factors of production may be substituted with one another. The increase in one factor, however, must still be used in conjunction with the decrease of another input factor. Isoquant curves cannot be tangent or intersect one another. Curves that intersect are incorrect and produce results that are invalid, as a common factor combination on each of the curves will reveal the same level of output, which is not possible. Isoquant curves in the upper portions of the chart yield higher outputs. This is because, at a higher curve, factors of production are more heavily employed. Either more capital or more labor input factors result in a greater level of production. An isoquant curve should not touch the X or Y axis on the graph. If it does, the rate of technical substitution is void, as it will indicate that one factor is responsible for producing the given level of output without the involvement of any other input factors. Isoquant curves do not have to be parallel to one another; the rate of technical substitution between factors may have variations. Isoquant curves are oval shaped, allowing firms to determine the most efficient factors of production.