What is Iso-quant?


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Iso-quant word become the joint of two words iso which means equal and quant which means quantity/product or output. Iso-quant curve is a technical relation between output and input which showing that how many inputs convert in to output.    Thus its meaning is equal quantity or equal output.  Iso quant is that curve which always shows the different possible combinations of two facts inputs yielding the same amount of output  .

 

Definition: 

 

According to Ferguson “An iso-quant is a curve which showing all possible combination of  inputs physically capable of producing a given level of output.

 

According to the Peterson “ An isoquant curve may be defined as a curve showing the possible combinations of two variable factors that can be used to produce the same total products.

 

 Main assumptions

 

  1. Two factors of Production
  2. Constant Technique
  3. Divisible Factor
  4. Possibility of Technical Substitution
  5. Efficient Combinations.

 

Properties of Iso-quant

 

  1. Isoquant Curve slopes Downwords
  2. Isoquant Curve are Convex to the Origin
  3. Two Isoquants curves cannot intersect each other
  4. The Higher the Isoquant Curve the Higher the  Level of output it represents
  5. Knowledge of the case of Factor substitution
  6. Ridge Line

 

  1. Isoquant Curve slopes Downwords :-   Isoquant curve always slope down from left to right.  if we use more of one factor we use less of the other.  If the amount of both factors are increased or decreased together the total output will not remain the same, it will be decreased  or increased respectively.  Substitutability of the factors is the reason behind downward slope of an iso-quant.  As per the figure given below:-

 

There are two factors capital and labour capital is on the axix  OY and labourer is on OX  axis  the iso-quant curve slope downward from Y to X.  There are many points are included in the iso-quant curve where the inputs and outputs are convert into each other.

 

 

 

  1. Iso-quant curve are convex to the origin :-

 

Iso quant curve always convex to its points of origin.  Point O is shown means that  Marginal Revenue Technical Substitution of Labour for Capital are diminishing 30 units of a capital are given up to use 10 additional unit of labour and only 20 units of capital are given upto use of yet another 10 units of labour.  Constant level of output can be maintained on the point only if capital is  sacrificed  at the diminishing rate of 10 additional unit of labour.  Similarly the capital is sacrificing on  use of another additional 10 unit of labour then reach 40 from 60, 30 from 40 for the same production on the additional unit of labour.  Thus the Iso quant curve convex to its origin. As per the figure given below  there are two factors capital and labour on axis OY and OX respectively.  We use capital 90 and labour  for getting production 100.  After that we change the capital and labour 90 to 60 and 10 to  20 respectively.  The capital is sacrificing 30 on the use of additional 10 units of the labour.

 

 

  1. Iso-quant curve cannot intersect each other:-

 

We know that one Iso-quant curve corresponds to a particular level of output and all points of Iso-quant curve indicate the same level of output. If the IQ cut each other that will be common point corresponding to both the IQs  which indicate two different levels of output.

According to the figure given  above input and out puts are two factors which are at OY axis and OX axis. Both the Iso-quant curves cut each other on the point S.  the production of IQ1 is 200 and IQ 100.  point R and point K  are showing the combination of other points.

 

 

  1. The Higher the  Iso-quant curve the higher the level of input at represents:  High Iso-quant curve represent high level output , because high iso-quant  curve are based on high level of input of the factor.

According to the figure a high iso-quant curve IQ1 show more level of output i.e. 200 units to 100 units as shown by lowers IQ curve.  More unit of input OK1 + OL1 > OK+OL .

 

  1. Knowledge of the case of factor substitution :-  Iso-quant curves reflects each with the factor which are substituted for one another.  If two factors are perfect substitute of one another the iso-quant curve will be in straight line.  If when two factors cannot be substituted, when they can be used in a fixed proportion only then the iso-quant curve in the shape of right angle.

 

 


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