Question

What is meant by production function?

Hint:

A production function is like a recipe: it tells you how much output you can get from a specific combination of ingredients (inputs).

Answer 1

A production function is a mathematical expression that shows the technical relationship between the inputs (factors of production like labor and capital) used in a production process and the maximum quantity of output that can be produced with those inputs. It is represented as: \[ Q = f(L, K) \] where Q is the quantity of output, L is labor, and K is capital. It describes the technological efficiency of a firm.