Microeconomics II
Microeconomics II
Unit II: Theory of Production
Unit – II
Theory of production: Isoquants and isocost lines; marginal rate of technical substitution; producer’s equilibrium; expansion path; elasticity of factor substitution; economies of scale; concept of producer’s surplus; output elasticity; concept of homogeneous production functions; concept and properties of Cobb-Douglas production function.
- Introduction to Production
- Isoquants in Production Theory
- Iso-cost Lines and the Role of Input Prices
- Marginal Rate of Technical Substitution (MRTS)
- Producer’s Equilibrium
- Expansion path
- Elasticity of Substitution (σ)
- Economies of Scale
- Producer’s Surplus
- Output Elasticity
- Cobb-Douglas Production Function (1928) and Its Properties
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