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    Production involves increasing the creation of utilities, which can be in the form, place, or time of a commodity's use. Form utility changes the physical form of a commodity, like turning wood into furniture, to increase its usefulness. Place utility transports a commodity, like sweaters, to locations where demand is higher. Time utility makes a commodity more useful depending on the period, such as increased demand for cool drinks in summer over winter. A production function defines the technical relationship between inputs like labor and land and the outputs they produce. In the short run, adding some variable inputs to fixed inputs initially increases output, but eventually output decreases, while in the long run all inputs can be varied and technology can change as well.

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    Production involves increasing the creation of utilities, which can be in the form, place, or time of a commodity's use. Form utility changes the physical form of a commodity, like turning wood into furniture, to increase its usefulness. Place utility transports a commodity, like sweaters, to locations where demand is higher. Time utility makes a commodity more useful depending on the period, such as increased demand for cool drinks in summer over winter. A production function defines the technical relationship between inputs like labor and land and the outputs they produce. In the short run, adding some variable inputs to fixed inputs initially increases output, but eventually output decreases, while in the long run all inputs can be varied and technology can change as well.

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    16 views2 pages

    Production Word

    Uploaded by

    somasundarapriya
    Production involves increasing the creation of utilities, which can be in the form, place, or time of a commodity's use. Form utility changes the physical form of a commodity, like turning wood into furniture, to increase its usefulness. Place utility transports a commodity, like sweaters, to locations where demand is higher. Time utility makes a commodity more useful depending on the period, such as increased demand for cool drinks in summer over winter. A production function defines the technical relationship between inputs like labor and land and the outputs they produce. In the short run, adding some variable inputs to fixed inputs initially increases output, but eventually output decreases, while in the long run all inputs can be varied and technology can change as well.

    Copyright:

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    PRODUCTION

    Production means overall increase in the creation of utilities


    TYPES OF UTILITIES
     FORM UTILITY
     PLACE UTILITY
     TIME UTILITY
    FORM UTILITY
     A commodity may be less useful in a particular form.
     When its form is changed , it is likely to yield a higher utility.
     Eg: changing a piece of wood into a table or chair.
    PLACE UTILITY
     A commodity may be less useful in a particular place.
     When it is transported to another place, it is most likely to yield a higher
    utility.
     Eg: Sweater are in great demand in cool climatic country than hot climatic
    country.
    TIME UTILITY
     A commodity may be less useful in a particular period .
     At another point of period , it may give more utility.
     Eg: Cool drinks are in great demand during summer than winter
    season.
    FACTORS OF PRODUCTION
     PRIMARY- land ,labour etc…
     SECONDARY- capital, org etc..
    PRODUCTION FUNCTION
    The technical relationship between inputs and outputs is known as production
    function
    TECHNIQUES OF PRODUCTION
    1. Efficiency of each factors.
    2. Combination of each factors
    SHORT RUN PRODUCTION
    Some inputs added to the fixed input, it causes output to increase but after a
    point the output level will become decrease.
    EI + FI à in Q after some period ¯ in Q1
    SHORT RUN PRODUCTION
    SHORT RUN PRODUCTION
    INCREASE RETURNS: Total product increase in output at an increasing
    rate.
    DECREASE RETURNS: Total product increase in output at an decreasing
    rate.
    NEGATIVE RETURNS: Negative output
     LONG RUN PRODUCTION FUNCTIONThe state of technology of all
    the
    factors can change.
    Q=f (L ,N)
    where Q = Qty of paddy supplied,
    L = Qty of Labor used,
    N = Qty of Land.
    LONG RUN PRODUCTION

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