function refers to the relationship among units of the factors of production
(inputs) and the resultant quantity of a good produced (output).
to George J. Stigler, “Production
function is the relationship between inputs
of productive services per unit of time and outputs of product per unit of
function may be expressed as: Q = f (N, L, K, T) Where, Q = Quantity of output,
N = Land; L = Labour; K = Capital; and T = Technology. Depending on the
efficiency of the producer, this production function varies.
function implies that the level of output (Q) depends on the quantities of
different inputs (N, L, K, T) available to the firm.
economics, the distinction between long run and short run is made on the basis
of fixed inputs that inhibit the production.
short-run is the period where some inputs are variable, while others are fixed.
Another feature is that firms do not enter into the industry and existing firms
may not leave the industry.
on the other hand, is the period featured by the entry of new firms to the
industry and the exit of existing firms from the industry.
general, Production function may be classified into two
Short-run Production Function as illustrated by the
Law of Variable Proportions.
Long-run Production Function as explained by the
Laws of Returns to Scale.