Question

Q.1. What is meant by variable factor and fixed factor? Give two examples of each?​

Answer 1

Explanation:

Variable factors are the factors of production which vary with the level of output. For example, Labour and Raw material. Fixed factors are the factors which remain fixed throughout the production process. For example, Land and Machinery.

Answer 2

Variable Factors

• Variable factors are factors of production that vary with each extra unit of production.
• It increases with an increase in the number of units produced and decreases when the production is decreased.
• Examples of variable factors are - raw materials, capital, labour.

Fixed Factors

• Fixed factors are those factors of production that do not change when the level of production changes.
• It remains constant even when there is no production.
• Examples of fixed factors are - land used for factories, machinery, computer systems.