Match the LIST-I with LIST-II
| LIST-I | LIST-II | ||
| A. | Production function | I. | Additional Product with change in input. |
| B. | Marginal Product (MP) | II. | Marginal product first increases and then begins to fall. |
| C. | Law of variable proportions | III. | Change in output due to change in factors. |
| D. | Returns to Scale | IV. | Relationship between inputs used and output produced. |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → A-IV, B-I, C-II, D-III
A firm turns inputs into output. In the short run it can change only one input, keeping the others fixed, and see what each extra unit adds; in the long run it can change all inputs together. The four terms describe these two ways in which output responds to inputs.
A. Production function — this matches (IV) Relationship between inputs used and output produced. The production function of a firm is the relationship between the inputs it uses and the output it produces. For each combination of inputs it gives the maximum output that can be produced with the technology the firm has.
B. Marginal Product (MP) — this matches (I) Additional Product with change in input. The marginal product of an input is the change in output per unit change in that input, with all other inputs held constant. For labour, MPL = ΔTPL / ΔL: it is the extra output that one more unit of labour adds.
C. Law of variable proportions — this matches (II) Marginal product first increases and then begins to fall. When more and more of one input is used with the other input fixed, its marginal product first rises and then falls. This tendency is called the law of variable proportions, or the law of diminishing marginal product. It arises because the proportion between the variable and the fixed input keeps changing as the variable input is increased.
D. Returns to Scale — this matches (III) Change in output due to change in factors. Returns to scale describe what happens to output when all factors are changed in the same proportion. Output may rise in the same proportion (constant returns), in a larger proportion (increasing returns) or in a smaller proportion (decreasing returns).
Note: One item of LIST-I can be matched with more than one entry of LIST-II:
(B) Marginal Product (MP) → both (I) Additional Product with change in input and (II) Marginal product first increases and then begins to fall. Entry (I) is the definition of marginal product. Entry (II) also speaks of marginal product: it describes how MP behaves as more of one input is used, which is the behaviour the law of variable proportions names.
NCERT (2025-26): “3.1 Production Function … The production function of a firm is a relationship between inputs used and output produced by the firm. For various quantities of inputs used, it gives the maximum quantity of output that can be produced. …3.3.3 Marginal Product Marginal product of an input is defined as the change in output per unit of change in the input when all other inputs are held constant.… …The rate at which TP increases, as explained above, is shown by the MP. Notice that the MP first increases (upto 3 units of labour) and then begins to fall. This tendency of the MP to first increase and then fall is called the law of variable proportions or the law of diminishing marginal product.… The law of variable proportions arises because factor proportions change as long as one factor is held constant and the other is increased. What if both factors can change? Remember that this can happen only in the long run. One special case in the long run occurs when both factors are increased by the same proportion, or factors are scaled up. When a proportional increase in all inputs results in an increase in output by the same proportion, the production function is said to display Constant returns to scale (CRS).…” |