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Topic: Isoquant

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Indifference curve

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	Isoquant - Wikipedia, the free encyclopedia
		In economics, an isoquant (derived from quantity and the Greek word iso [meaning equal]) is a contour line drawn through the set of points at which the same quantity of output is produced while changing the quantities of two or more inputs.
		Isoquants are typically drawn on capital-labor graphs, showing the tradeoff between capital and labor in the production function, and the decreasing marginal returns of both inputs.
		An isoquant map can also indicate decreasing or increasing returns to scale based on increasing or decreasing distances between the isoquants on the map as you increase output.
	en.wikipedia.org /wiki/Isoquant (645 words)

	Isoquants - A free software to understand your textbook
		Isoquants are easy to draw in diagrams when productive inputs are just two, whereas when there is only one productive input the production function we describe here is more relevant.
		The isoquants approach emphases the choice of the right "quantity" of input, whereas the true problem is the "quality" of the input.
		The isoquant approach assuming that a product made with large amounts of labour + small amount of capital is exactly the same as another one made with small amount of labour + large amount of capital is a very special case, not the general one.
	www.economicswebinstitute.org /software/isoquants.htm (1588 words)

	ColombiaLink.com - PRODUCTION THEORY BASICS - MICROECONOMICS
		An isoquant, in the two input case, is a curve that shows all the ways of combining two inputs so as to produce a given level of output.
		Isoquants are usually considered to be everywhere dense, meaning an infinite number of them could be plotted in any two input space.
		Isoquants are typically convex to the origin reflecting the fact that the two factors are substitutable for each other at varying rates.
	www.colombialink.com /01_INDEX/index_finanzas_eng/production_theory_basics.html (2065 words)

	Examples and exercises on isoquants and the marginal rate of technical substitution
		This set is shown in the following figure, together with the isoquant for the output 2.
		This isoquant, together with the 2-isoquant is shown in the following figure.
		The two corners of the isoquant correspond to the case in which all the machines in the factory run slowly, and the case in which they all run fast.
	www.chass.utoronto.ca /~osborne/2x3/tutorial/ISOQEX.HTM (577 words)

	APPENDIX C3A. THE HORIZONTAL-SLICE APPROACH
		The isoquant map may be likened to the collection of isotemp or isobar lines on a weather map, or to the contour lines on a geological or military map.
		The reader is invited to analyze the likely shapes of the isoquant maps that could be generated from the surfaces illustrated in panels (a), (b), and (c) in Figure C3-1.
		The slope of an isoquant at any point may be measured by the slope of a tangent drawn to the point, or it may be approximated by the slope of a chord connecting two points near to each other along the isoquant.
	facweb.furman.edu /~dstanford/mecon/c3a.htm (2173 words)

	Production theory basics (Site not responding. Last check: 2007-11-03)
		An isoquant, in the two input case, is a curve that shows all the ways ofcombining two inputs so as to produce a given level of output.
		The upward sloping parts of isoquants, for example, indicate that thatlevel of output could be produced by less of both inputs so this section is of little interest to decision makers.
		Isoquants are typically convex to the origin reflecting the fact that the two factors are substitutable for each other atvarying rates.
	www.therfcc.org /production-theory-basics-3278.html (1984 words)

	Isoquant - the free encyclopedia (Site not responding. Last check: 2007-11-03)
		Another way of defining the isoquant is a curve that shows all possible quantities of inputs that result in the same level of output with a given
		returns to scale based on increasing or decreasing distances between the isoquants on the map as you increase output.
		B) Example of an isoquant map with two inputs that are perfect compliments.
	www.free-web-encyclopedia.com /default.asp?t=Isoquant (584 words)

	[No title]
		An isoquant is a curve that shows all combinations of inputs that will produce the same level of output, provided that the inputs are used in a technologically efficient manner (i.e., it is the maximum output you can get for a combination of inputs (L,K)).
		Isoquants must slope downward so long as each input is productive and has a positive marginal product.
		Isoquants are convex because, as the first input becomes scarcer and the second input more abundant, it becomes more difficult to substitute one input for another and keep output constant.
	www.davidson.edu /academic/economics/foley/eco101_f02/ps4_sol.doc (662 words)

	CHAPTER 2. THE THEORY OF INTERNATIONAL TRADE
		Both of the technologies illustrated by the isoquants in panels (a) and (b) of Figure 2-1 as well as that illustrated in Figure C3A-2 of Volume 1 exhibit a relatively high degree of factor substitutability between labor and capital, subject to the relative factor intensities.
		If the isoquant map exhibited such great angularity that the isoquants were L-shaped as illustrated in panel (b) of Figures 2-2, labor and capital would not be substitutable for each other at all.
		Isoquant maps may exhibit relatively more or less capital or labor intensity in the slopes and shapes of the isoquant curves.
	facweb.furman.edu /~dstanford/trade/g2.htm (6247 words)

	chapter 1
		If the isoquant is steep it is difficult to substitute purchased goods for the loss of an hour of household time, thus must give up a lot of purchased good.
		In addition to isoquants having constant utility and negative and convex slopes we note that a ray from the origin through the isoquants shows the ratio of purchased goods and services to household time in production of child rearing is constant for different isoquants.
		Since their utility isoquant is steep (showing they would need a lot of money to make up for reduced time in household production) they tend to spend more time in household production.
	www.oswego.edu /~spizman/labeco7a.html (3373 words)

	Isoquants (Site not responding. Last check: 2007-11-03)
		Isoquants may take a wide variety of forms.
		It is easy to give examples of technologies for which the isoquants do not take this form, but in the theory we treat such isoquants as typical.
		For a typical production function, with isoquants convex to the origin, the MRTS diminishes as more of input 1 is used.
	www.chass.utoronto.ca /~osborne/2x3/tutorial/ISOQUANT.HTM (282 words)

	D ITS APPLICATION
		An isoquant is a curve that shows the various combinations of inputs that will produce the same (a particular) amount of output.
		The curve labeled q = 10 is an isoquant that shows various combinations of labor and capital, such as points A and B, that produce exactly 10 units of output per period.
		Isoquants record successively higher levels of output the farther away from the origin they are in a northeasterly direction.
	www.k-state.edu /economics/ramesh/E520CHP5.HTM (2256 words)

	Using Supply and Demand
		The Isoquant curve contains all combinations of 2 inputs that produce the same total output.
		The "isoquant map" is a picture of the state of technology.
		The optimal combination will be the one where the isoquant is just tangent to the isocost.
	s01.middlebury.edu /EC155A/Supplements/Lectures/isocost-isoquant.html (412 words)

	[No title]
		The slope of the isoquant measures the number of part time workers that can be exchanged for a full time worker, while still maintaining output.
		When we are at the bottom end of the isoquant we have a lot of full time workers and few part time workers.
		The isoquant is therefore convex and we have diminishing marginal rate of technical substitution.Knowing this information will help the firm choose the right mix of permanent and temporary employees.
	www.csupomona.edu /~gwhunter/EC401/Answers/Ch6.doc (717 words)

	[No title]
		It is perhaps worth noting that, although the basic technologies available are non-convex, once combined they provide the firm with an isoquant that is more reminiscent of the convex shape usually presumed in producer theory.
		In each case, use a sketch of the isoquant map to consider a firm’s choice of optimal input bundle.
		At that point, the slope of the isoquant is not defined.
	www.ucd.ie /economics/staff/lporter/2micro2solution.doc (1739 words)

	Production theory basics - The Jiggies Reference Guide (Site not responding. Last check: 2007-11-03)
		For eample in agriculture, the amount of land, water, and fertilizer can all be varied to produce different amounts of a crop.
		A complete isoquant is actually circular, but only the “down sloping to the right” portion makes economic sense.
		In the unusual case of two inputs that are perfect substitutes for each other in production, the isoquant would be linear.
	www.jiggies.com /reference/Production_theory_basics (2082 words)

	Get the most out of production using marginal analysis - Small changes from present condition can provide basis for ...
		An isoquant is a curve that represents, as the name suggests, various combinations of the two factors of production that result in an equal quantity of output.
		As is the case with isoquants, a family of isocosts can be generated.
		The final step of the analysis is to identify the point of tangency, that is, the point where the least expensive isocost is tangent to the desired isoquant.
	www.ophthalmologytimes.com /ophthalmologytimes/article/articleDetail.jsp?id=22005 (1009 words)

	Production (Site not responding. Last check: 2007-11-03)
		MPL is represented on an isoquant graph by a shift across curves, holding capital fixed, as in figure 7.7.
		In panel a, the location of the curve is skewed upward to the left, and the isoquant is somewhat steep.
		The slope of the isocost curve is -w/r, and the slope of the isoquant is
	www.ses.wsu.edu /people/faculty/rosenman/dist301/prod2a.htm (6236 words)

	[No title]
		Graphically an isoquant can be shown for a product produced by using two inputs as in Fig.
		The output of 20 and 30 units is constant at every point on the isoquants A and B respectively.
		Isoquants look similar to indifference curves, an important difference is that output in comparison to utility can be measured.
	www.csun.edu /~hceco008/notesec110908.doc (525 words)

	ECO 240 \| Tutorial 7b
		Isoquants show various combinations of two inputs that produce a given level of output.
		As it turns out, isoquants are convex to the origin because their slope, called the marginal rate of technical substitution (MRTS), diminishes as more labor is used with less capital.
		The reason the slope diminishes is because it is equal to the ratio of the marginal products of the inputs, MP, and as more L is used, MPL declines (law of diminishing returns), as less K is used, MPK increases (law of diminishing returns in reverse!).
	www.ilstu.edu /%7Emswalber/ECO240/Tutorials/Tut07/Tutorial07b.html (955 words)

	South-Western EconNews
		Add an isoquant that shows all the technologically efficient ways of producing a given level of agricultural output.
		Explain why the isoquant changes in the manner you have drawn.
		Draw a further diagram with the same axes and include the initial isoquant and the first isocost line, such that they are tangent to each other.
	anderson-chasey.swcollege.com /economics/econ_news/precision_plowing_1101.html (361 words)

	Ardent BBS > Archival Fall 2003 Q and A > questions on 1 f) of 2002Final Exam
		As you increase your budget (move the line upwards), the re is a point you hit the isoquant.
		Because only then will it hit the point of the isoquant that you want it to hit.
		If its slope is equal to MRS between the alternative activities, then any linear combination between them is indifferent, while if it is smaller than MRS, gradually "raising" the budget line will hit the right-most point of the isoquant first.
	ardent.mit.edu /realbbs/thread.php?id=250 (304 words)

	"Assuming there are two factors of production, explain clearly with the aid of diagrams, the way in which a firm ... (Site not responding. Last check: 2007-11-03)
		This allows the firm to move along an isoquant without be affected by a fall in output.
		The slope of the isoquant tells us the rate at which the firm can substitute one factor for another while still producing the same output.
		In order to establish which combination of factors on the isoquant is economically efficient to the firm, we need...
	www.acumenenterprise.com /Business_-_General/Assuming_there_are_two_factors_of_production_explain_clearly_L20056 (378 words)

	Appendixes \| Student Resources \| Microeconomics and Behavior
		But there is also a geometric technique for deriving the isoquant map, one that is similar to the derivation of the indifference map discussed in the Appendix to Chapter 3.
		As defined in Chapter 9, an isoquant is a locus of K, L pairs that produce the same level of output.
		This meant that the MRS was infinite on the vertical arm of the indifference curve, zero on the horizontal arm, and undefined at the cusp.
	www.mhhe.com /economics/frank4/student/appendixes/appendix9.mhtml (2391 words)

	The Production Function
		The term on the left is the negative of the slope of the isoquant corresponding to output level Y*.
		In Figure 2.4, on isoquant Y, as we move from point a to b to c to d, we are moving towards greater employment of K and less employment of L to produce a given level of output Y, thus we are moving from labor-intensive techniques (i.e.
		Notice also that the isoquant becomes flatter as we move from a to d, thus the marginal rate of technical substitution is higher at a than at d, i.e.
	cepa.newschool.edu /het/essays/product/prodfunc.htm (5601 words)

	International Economics Glossary: U
		An isocost line along which cost is equal to one unit of the numeraire, such as one dollar.
		In a Heckscher-Ohlin Model this varies along an isoquant as different techniques are chosen in response to different factor prices.
		The isoquant for a quantity of a good worth one unit of value.
	www-personal.umich.edu /~alandear/glossary/u.html (990 words)

	Long Run Production
		Narrator: But for now, the isoquant line for 1000 units is her constraint, representing her current dishwashing load.
		This tells us that Marge could be spending less each week is she used a combination of worker and machine to clean the dishes.
		Narrator: For each isoquant curve, there is a tangential isocost line that represents minimum cost.
	www.swlearning.com /economics/cebula/micro_c04_dialog.html (614 words)

	Isoquants and the Producer's equilibrium
		Each point on this curve is represented as a combination of K and L that yields an output level of 1000 units.
		Therefore, as we move along this isoquant output is constant (much like the fact that utility is constant as we move along an indifference curve).
		The slope of the isoquant is the ratio of the marginal products, MP, which is given as the marginal rate of technical substitution (MRTS).
	louisville.edu /~bmhawo01/econpage/301/handouts/isoquants/index.html (729 words)

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