Curvature of the iso-quant, Microeconomics

Curvature of the Iso-quant:

An iso-qunat is convex to the origin. This is so because as more and more units labour are employed, the producer would prefer to give up less and less of the other input to produce the same amount of output. This is shown in the following Figure:  

 

272_Curvature of the Iso-quant.png

For a rise in L from L1 to L2, the producer gives up K1 amount of K. For the same output level  q, as L increases from L3 to L4, she gives up K2 amount of K. As K2 < K1, it implies that for more units of L, the producer is willing to give up less of K. A convex iso-quant implies a diminishing MRTSLK. As   MRTSLK = MPi/MPk, a diminishing MRTS means as L increases, L MP  decreases and MPK increases.  

Posted Date: 10/26/2012 6:46:31 AM | Location : United States







Related Discussions:- Curvature of the iso-quant, Assignment Help, Ask Question on Curvature of the iso-quant, Get Answer, Expert's Help, Curvature of the iso-quant Discussions

Write discussion on Curvature of the iso-quant
Your posts are moderated
Related Questions
Describe Dalton''s law of partial pressures, specification of Dalton''s law of partial pressures, Dalton''s law states that, at a given known temperature total pressure exerted b

do you think that dimnishing returns to a factor are consistent with increasing returns to scale? explain with suitable diagram and reasoning.

Uses of price and income elasticity of demand: The concept of price elasticity of demand has some uses whihc include the following: (i) Pricing of goods and services It is

Economic instruments Financial rewards, incentives and penalties that operate automatically via market forces, to encourage beneficial behavior.

Factors determine the price elasticity of supply: The price elasticity of supply varies widely across different products. Some products have more leastic supply, while others

How can we test adulterants in vegetable oils?

Mixed Economy: This type of economic system combines the features of both the capitalist and socialist economic systems. The private sector is allowed to function on the principles

Circular Flow of Income: The diagram shows Real Flow (goods and services) and Monetary Flow (Income and expenditure). The bottom pair of arrows depicts the goods market.

#question.what is elasticity of demand? .

Explain why each of the following factors may influence the own price elasticity of demand for a commodity. (i) Consumer preferences, that is, whether consumers regard the commodi