Question : The production function shows the relationship between:
Option 1: Price and quantity demanded
Option 2: Price and quantity supplied
Option 3: Input and output
Option 4: Expenditure and income
Correct Answer: Input and output
Solution : The correct answer is (c) Input and output.
The production function shows the relationship between inputs (such as labor, capital, raw materials) and output (goods or services) in the production process. It represents how various combinations of inputs result in the production of a certain level of output.
The production function typically takes the form of a mathematical equation or a graphical representation that illustrates how the quantity of inputs affects the quantity of output produced. It helps to explain how factors of production are transformed into finished goods or services.
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