Production function for wheat, Microeconomics

Production Function for Wheat

*  Farmers should choose between a capital intensive or labor intensive technique of production.

Isoquant Describing Production of Wheat

128_production of wheat.png

*  Observations:

 1) Operating at A:

  • L = 500 hours and K = 100 machine hours.

 2) Operating at B

  • Increase L to 760 and decrease K to 90 MRTS < 1:


3) MRTS < 1, hence the cost of labor should be less than capital in order for the farmer substitute labor for capital.

4) If labor is expensive, farmer would use more capital (such as U.S.).

5)  If labor is inexpensive, farmer would use more labor (such as India).

Posted Date: 10/12/2012 1:51:58 AM | Location : United States







Related Discussions:- Production function for wheat, Assignment Help, Ask Question on Production function for wheat, Get Answer, Expert's Help, Production function for wheat Discussions

Write discussion on Production function for wheat
Your posts are moderated
Related Questions
what is the theory of second best?prove the theorm with the help of diagram?

An economy has only one member Robinson Crusoe. Robinson allocates his time between fishing and collecting fruits. One hour spent finishing yields 4 fish. One hour spent collecting

Illustrate the measurement of inputs and outputs in production technology? Measurement of Inputs and Outputs in Production Technology This is generally most satisfactory to

PARAMETERS FOR ASSESSING ECONOMIC REFORMS: Let it be clearly understood that liberalisation, privatisation and globalisation are means with the help of which the growth proces

when does market equilibrium occur?

is it just assumed that a monopoly graph is showing economic profit instead of accounting profit


what are the sources of monopoly power

Which assumption of Classic OLS does this model violate?

how does compensated demand curve help managers?