1.

Describe the assumptions of production function.

Answer»

The following are the assumptions of production function :

  1. There should be no change in the level of technical knowledge.
  2. The costs of means of production should remain the same.
  3. Production function is related to a definite time period.
  4. The means of production should be divisible.
  5. The most efficient techniques of production should be employed.
  6. The means of production can be substituted upto a limited extent.
  7. There is uniformity among the means of production.
  8. The objective of the firm should be maximization of production.


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