Question

What is the difference between a production function and an​ isoquant?

A.

A production function describes the maximum output that can be achieved with any given combination of inputs. An isoquant identifies the different types of inputs that can be used to produce various levels of output.

B.

A production function describes the minimum output that can be achieved with any given combination of inputs. An isoquant identifies all of the different combinations of inputs that can be used to produce one particular level of output.

C.

A production function describes the maximum output that can be achieved with any given combination of inputs. An isoquant identifies all of the different combinations of inputs that can be used to produce one particular level of output.

D.

A production function describes the minimum output that can be achieved with any given combination of inputs. An isoquant identifies the different types of inputs that can be used to produce various levels of output.

Answer 1

Answer: C. A production function describes the maximum output that can be achieved with any given combination of inputs. An isoquant identifies all of the different combinations of inputs that can be used to produce one particular level of output.

If there are two inputs, say labor(L), and capital(K), then the quantity (Q) of production would depend on the use of these two inputs.So, we can write the production function as follows;

Q = f(L,K).

The production function shows the maximum level of output, a firm can produce by employing a specific combination of inputs.

The isoquant, i.e., equal quantity, is a locus of points of different combinations of inputs, that can be used to produce a particular quantity of output, i.e., all the combinations of inputs on an isoquant curve give the same level of output.

The above figure shows quantity of labor on the horizontal axis, and the quantity of capital on the vertical axis.The 'IC' is the isoquant curve, which shows a particular amount of output, that can be produced by using either (L₁, K₁) combination of inputs, or (L₂ , K₂) combination of inputs.There are also many other input combinations, that can produce the same quantity of output represented by isoquant curve 'IC'.

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