Meaning of ISOQUANTS
The word an isoquant is a locus of points, representing different
combinations labour and capital .An isoquant Curve. ‘ISO’ is of Greek origin
and means equal or same and ‘quant’ means quantity. An isoquant may be defined as a
curve showing all the various combinations of two factors that can produce a given level
of output. The isoquant
shows- the whole range of alternative ways
of producing- the same level of output. The modern
economists are using isoquant, or ‘ISO’ product curves for determining the
optimum factor combination to produce certain units of a commodity at
the least cost.
Properties
or Features of Isoquant
The following are the important properties of isoquants:
1. Isoquant is downward sloping to the right. This means that if
more of one factor is used less of the other is needed for producing the same
output.
2. A higher isoquant represents larger output.
3. No isoquants intersect or touch each other. If so it will mean
that there will be a common point on the two curves. This further means that
same amount of labour and capital can produce the two levels of output which is
meaningless.
4. Isoquants need not be parallel to each other. It so happens
because the rate of substitution in different isoquant schedules need not
necessarily be equal. Usually they are found different and therefore, isoquants
may not be parallel.
5. Isoquant is convex to the origin. This implies that the slope
of the isoquant diminishes from left to right along the curve. This is because
of the operation of the principle of diminishing marginal rate of technical
substitution.
6. No isoquant can touch either axis. If an isoquant touches X
axis then it would mean that without using any labour the
firm can produce output with the help of capital alone. But this is wrong
because the firm can produce nothing with OK units of capital alone. If an
isoquant touches Y axis, it would mean that without using any capital the firm
can
produce output with the help of labour alone. This is impossible.
7.Isoquants have negative slope. This is so because when the
quantity of one factor (labour) is increased the quantity of other factor
(capital) must be reduced, so that total output remains the same.
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