Isoquant or Iso-product curve
Production Function with two Variable Inputs The prime concern of a firm is to use the cheapest factor combination to produce a given quantity of output. There are a large number of alternative combinations of inputs that can produce a given quantity of output for a given amount of investment. Hence, a producer has to select the most economical combination out of them. The most common and simple tool of analysis is the isoquant curve technique which is a parallel concept to the indifference curve in the theory of consumption. The word “ isoquant ” simply means equal quantities. Therefore, it is also known as ‘equal product curve’ or ‘production indifference curve’. It is also called the iso-product curve. An isoquant curve is a locus of points representing various combinations of two inputs-capital and labor- yielding the same output. In other words, an isoquant curve shows all those combinations of two variable inputs that yield a given quantity of product. If there are diff...