State five types of Production Function.
Answers
Answer:
Meaning of Production Function:
Production is a process whereby some goods and services, called inputs are transformed into other goods and services called output. The production function refers to the relationship between the input of factor services and the output of the resultant product. The production function is based on the idea that the amount of output in a production process depends upon the amount of inputs used in the process.
Output depends upon an input or a set of inputs in such a way that there is one unique amount of output resulting from each set of inputs. This unique relationship between output and inputs is termed as production function.
Halcrow defines production function as follows:
“Production function is the technical relationship between inputs & output indicating the amount of output that can be produced with each and every set or combination of the specified inputs”. A production function always assumes as given, a state of knowledge and technology.
A production function may be expressed in three forms:
(a) It can be expressed in the form of an arithmetic table where first few columns show the input of the factors and the last column shows total output of the product as has been depicted below. Here, for the sake of simplicity, we take only one input.)
Production Function
In the above table, fertilizer is the variable input (applied to a fixed price of land with other fixed inputs). Total corn yield is increasing (column 2) as more units of fertilizers are applied.
(b) The production function can also be illustrated geometrically by means of a simple graph as shown in Fig. 1. Input level is measured along the horizontal axis and the total output upon he vertical axis.
Production Function
The points on the curve OT indicate different quantities of output associated with particular levels of the input used.
(c) The production function may be shown through an algebraic expression in which output is a dependent variable and input, the independent variable.
In algebraic form, it can be expressed as:
Y =f(x),
where Y represents the output, x, the input and ‘f’ means is a function of, or ‘depends upon, or is determined by’. Here, it is assumed that output depends upon a single factor. However, it must be understood that in actual life, agricultural output (and for that matter, any output) is never a function of a single factor. It rather depends upon a variety of factors, such as seeds, amount of fertilizers used, irrigation, nature of soil and so on. This can be written as:
Y = f (x1, x2, x3………………….. xn) + u
This function means that output depends upon all factors represented by x1, x2 etc., and also the level of unknown or uncontrollable factors represented by u. It is not feasible to consider all controllable factors simultaneously in any one study.
Therefore, each factor may be studied in combination with some factors considered as fixed. For illustration, a farmers may be interested in knowing how the output of wheat will change as the two inputs namely, the seeds and fertilizers are changed while other factors are held constant at fixed levels.
Types of Production Function:
We should note that a production function expresses a unique relationship between total output and the various inputs. Generally, the total output increases with an increase in inputs. Like any other function, all such functions where total output increase as the inputs increase, are known as increasing production functions,
There are also situations in the real world where an increase in inputs, instead of bringing about an increase in the total output, may decrease it. Such a production function will be known as decreasing production function.
Answer:
Explanation:
Four most important production functions are: 1. Linear Homogeneous Production Function, 2. Cobb-Douglas Production Function 3. Constant Elasticity of Substitution Production Function and 4.