PPT : Theory of Production | SSC CGL Tier 2 - Study Material, Online Tests, Previous Year PDF Download

 Page 1


Theory of Production 
?
Production is a process that create/adds value or 
utility 
?
It is the process in which the inputs are converted in 
to outputs. 
Page 2


Theory of Production 
?
Production is a process that create/adds value or 
utility 
?
It is the process in which the inputs are converted in 
to outputs. 
Production Function 
?
Production function means the functional relationship 
between inputs and outputs in the process of 
production.
  
?
It is a technical relation which connects factors inputs 
used in the production function and the level of 
outputs  
 
Q = f (Land, Labour, Capital, Organization, Technology, etc)
Page 3


Theory of Production 
?
Production is a process that create/adds value or 
utility 
?
It is the process in which the inputs are converted in 
to outputs. 
Production Function 
?
Production function means the functional relationship 
between inputs and outputs in the process of 
production.
  
?
It is a technical relation which connects factors inputs 
used in the production function and the level of 
outputs  
 
Q = f (Land, Labour, Capital, Organization, Technology, etc)
Factors of Production 
Page 4


Theory of Production 
?
Production is a process that create/adds value or 
utility 
?
It is the process in which the inputs are converted in 
to outputs. 
Production Function 
?
Production function means the functional relationship 
between inputs and outputs in the process of 
production.
  
?
It is a technical relation which connects factors inputs 
used in the production function and the level of 
outputs  
 
Q = f (Land, Labour, Capital, Organization, Technology, etc)
Factors of Production Inputs : Fixed inputs  and Variable inputs
?
The factors of production that is carry out the 
production is called inputs.
?
Land, Labour, Capital, Organizer, Technology, are 
the example of inputs   
Inputs Factors
Variable inputs Fixed Inputs
Page 5


Theory of Production 
?
Production is a process that create/adds value or 
utility 
?
It is the process in which the inputs are converted in 
to outputs. 
Production Function 
?
Production function means the functional relationship 
between inputs and outputs in the process of 
production.
  
?
It is a technical relation which connects factors inputs 
used in the production function and the level of 
outputs  
 
Q = f (Land, Labour, Capital, Organization, Technology, etc)
Factors of Production Inputs : Fixed inputs  and Variable inputs
?
The factors of production that is carry out the 
production is called inputs.
?
Land, Labour, Capital, Organizer, Technology, are 
the example of inputs   
Inputs Factors
Variable inputs Fixed Inputs
Inputs : Fixed inputs  and Variable inputs
Fixed inputs
?
Remain the same in the 
short period . 
?
At any level of out put, the 
amount is remain the same.
?
The cost of these inputs are 
called Fixed Cost  
?
Examples:- Building, Land 
etc 
?
( In the long run fixed inputs are 
become varies)
Variable inputs
?
In the long run all factors 
of production are varies 
according to the volume of 
outputs.
?
The cost of variable inputs 
is called Variable Cost
?
Example:- Raw materials, 
labour, etc