Production is the act of transforming inputs into output. Production function relates inputs to output; it describes the technological relationship between the physical inputs that a firm uses and the physical output that it produces. This functional relationship between inputs and output, or the production function can be written as
Q = f (a, b, c, d .........n)
Where Q is the quantity of a good produced and a, b, c, d…..n are the quantities of various inputs used. The functional relationship is shown by letter f that shows the dependence of Q on inputs which means that Q is dependent variables, and a change in these independent variables causes a change in the dependent variable Q.
If capital and labour are the only two factors (inputs) used in the production process, then the production function can be written as
Q = f (L, K)
Where L is the quantity of labour used in production with K as the amount of capital. The production function is thus the algebraic expression of the relationship between the quantities of input and the resultant quantity of output of any given product.SUBMIT ASSIGNMENT NOW!