Production Function Graph Explanation. A Total Physical Product of x TPP x rises at increasing rate of return. Health H is a durable good that can be produced by the individual.
Production Function from 2012books.lardbucket.org
MPPx rising and production function curve is concave upward. Explanation of Production Function Curve. In the long run production function is explained by assuming all the factors of production as variable.
The production function relates the quantity of factor inputs used by a business to the amount of output that result.
As shown in the above diagram the short-run production function puts the quantity of labor L on the horizontal axis since its the independent variable and the quantity of output q on the vertical axis since. In manufacturing industries such as motor vehicles it is straightforward to. No resources beyond that point should be allocated to production. Since by definition capital is fixed in the short run our production function becomes latexQfleftLtextstackrel-Krighttextor QfleftLrightlatex This equation simply indicates that since capital is fixed then changing the amount of output eg.
