CHAPTER 5
PRODUCTION FUNCTION
WITH ONE VARIABLE
INPUT
MISS NURUL AZWA BINTI MOHAMED KHADRI
, 1. All businesses must make three decisio
how much output to generate, wh
manufacturing technique to use, and h
The Behavior much of each input to require.
of Profit 2. Optimal mode of production: a techni
of production that reduces costs w
Maximizing increasing output. Three things
Firms necessary for a company to know:
➢ The market price of output
➢ The accessible production techniques
➢ The prices of input
PRODUCTION FUNCTION
WITH ONE VARIABLE
INPUT
MISS NURUL AZWA BINTI MOHAMED KHADRI
, 1. All businesses must make three decisio
how much output to generate, wh
manufacturing technique to use, and h
The Behavior much of each input to require.
of Profit 2. Optimal mode of production: a techni
of production that reduces costs w
Maximizing increasing output. Three things
Firms necessary for a company to know:
➢ The market price of output
➢ The accessible production techniques
➢ The prices of input
