EduAdda By Sailesh Goenka

PRODUCTION
Class 11 - Economics

1. Point of inflexion refers to that point from where: [1]

a) slope of TP changes b) slope of AP changes

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c) TP stops increasing at an increasing rate d) slope of TP changes and TP stops increasing
at an increasing rate
2. During short period, production can be increased through: [1]

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a) greater application of all the factors of b) greater application of variable factors
production
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c) none of these d) greater application of fixed factors
3. When MP is constant: [1]
ka
ab

a) TP is increasing at a constant rate b) TP is also constant

c) TP is zero d) TP is decreasing at a constant rate

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4. What happens to AP, when MP is more than AP? [1]
dd

a) AP remains constant b) AP rises

c) None of these d) AP falls

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5. production function shows technical relationship between physical inputs and output of a commodity [1]

a) Technological relationship between inputs b) Economic relationship between inputs and

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and price output

c) Technological relationship between inputs d) Technological relationship between inputs

and output and cost
6. With respect to production, the short run is best defined as a time period: [1]

a) lasting about two years b) in which at least one input is fixed

c) lasting about six months d) in which all inputs are fixed

7. Which one of the following leads to the law of variable proportions? [1]

a) None of these b) Some factors are constant

c) Some factors are more efficient than others d) Specialisation of factors

8. At which time all the factors of production may be changed? [1]

a) All the these b) Short-run

c) Long-run d) Very Long run

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 9. In the context of the long-run production function, the factor ratio is: [1]

a) constant b) none of these

c) variable d) variable as well as constant

10. Law of variable proportion explains three stages of production. In the first stage of production: [1]

a) MP rises b) Both MP and AP rise

c) MP is zero d) AP falls
11. Do you agree with the view that TP increases even when MP is decreasing? [1]
12. When does a production function satisfy decreasing returns to scale? [1]
13. When is total output maximum? [1]
14. Do you agree that an intelligent producer can avoid the occurrence of diminishing returns to a factor even with [1]

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the existing technology?
15. What is the total product of an input? [1]
16. Can total production and average production become zero or negative? [1]

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17. When does a production function satisfy increasing returns to scale? [1]
18. Define short-run production function. [1]
19.
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What are the fixed factors of production? [1]
20. Give the meaning of returns to a factor. [1]
21. Assertion (A): MP increases in stage I as per law of variable proportion. [1]
Reason (R): Fuller use of the variable factor.
ka
ab

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
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explanation of A. correct explanation of A.
dd

c) A is true but R is false. d) A is false but R is true.

22. Assertion (A): Increasing returns to a factor is a short-run phenomenon. [1]
uA

Reason (R): Greater application of the variable factor ensures fully utilization of the fixed factor.

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
explanation of A. correct explanation of A.
Ed

c) A is true but R is false. d) A is false but R is true.

23. Assertion (A): Average product increases only when marginal product increases. [1]
Reason (R): AP increases so long as MP is greater than AP whether MP is rising or falling.

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
explanation of A. correct explanation of A.

c) A is true but R is false. d) A is false but R is true.

24. Choose the correct match: [1]

a) Diminishing return to a factor ⇒ TP b) None of these

decreases

c) Increasing return to a factor ⇒ TP increases d) Negative Return to a factor ⇒ TP increases

at increasing rate at diminishing rate
25. Which of the following statement is true? [1]

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 i. Marginal Product refers to total output produced by a firm during a given period of time with a given number
of inputs.
ii. Average Product refers to total output produced by a firm during a given period of time with a given number
of inputs.
iii. Total Product refers to total output produced by a firm during a given period of time with a given number of
inputs.
iv. Total Product refers to total input produced by a firm during a given period of time with a given number of
outputs.

a) only ii b) only i

c) only iv d) only iii

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26. State giving reasons whether the following statements are true or false. [3]
i. Under diminishing returns to a factor, Total Product continues to increase till Marginal Product reaches zero.
ii. Where there are diminishing returns to a factor, Total Product first increases and then starts falling.

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iii. When Marginal Product falls, Average Product will also fall.
27. Give the behaviour of Marginal Product and Total Product as more and more units of only one input are [3]
employed while keeping other inputs as constant.
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28. Find out the maximum possible output for a firm with zero unit of L and 10 units of K when its production [3]
function is Q = 5L + 2K.
29. What is the law of diminishing marginal product? [3]
ka
ab

30. Giving reasons, explain the Law of Variable Proportions. [3]

31. State the relation between AP and MP. [3]
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32. Calculate the average and marginal product from the following: [3]
dd

Units of Labour 1 2 3 4 5 6 7

Total Product 20 36 48 56 60 60 56
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33. How does total product behave with change in marginal product? [3]
34. Explain the changes that take place in Total Product and Marginal Product under increasing returns to a factor. [3]

35. Let the production function of a firm be Q = 2 L2 K2 [3]

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Find out the maximum possible output that the firm can produce with 5 units of L and 2 units of K. What is the
maximum possible output that the firm can produce with zero unit of L and 10 units of K?
36. Explain the likely behaviour of total product. When only the unit of a variable factor is increased and keeping all [4]
other factor fixed. Use numerical example.
37. State different phases of the Law of Variable Proportions on the basis of Total Product. Use the diagram. [4]
38. What is the relevance of stages (or phases) of production to the producer? [4]
39. The following table gives the average product schedule of labour. Find the total product and marginal product [4]
schedules. It is given that the total product is zero at zero level of labour employment.

L 1 2 3 4 5 6

APL 2 3 4 4.25 4 3.5

40. The following table gives the marginal product schedule of labour. It is also given that total product of labour is [4]
zero at zero level of employment. Calculate the total and average product schedules of labour.

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 L 1 2 3 4 5 6

MPL 3 5 7 5 3 1

41. Identity the three phases in the law of variable proportion from following information: [4]

Units of Variable Input Total Products (Units)

0 0

1 4

2 14

3 22

4 28

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5 32

6 34

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7 34

8 32
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42. Complete the following table: [4]

TP AP MP
Units of Variable input
(Units) (Units) (Units)
ka
ab

1 - - 20
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2 - - 26
dd

3 66 - -

4 - 19 -
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5 - - 4

43. Define law of diminishing returns (DR) to a factor. Explain it with the help of a schedule. [4]
Ed

44. Define Law of Constant returns to a factor. Explain. [4]

45. FDI not only brings investment to the domestic economy but also brings new technology. How would the [4]
availability of new technology (relating to the auto industry) impact the short period production function of a car
manufacturer in India?
46. State True or False: [5]
(i) Law of variable proportions operates only if the factor ratio happens to change. [1]
(ii) The long-period production function is also called variable proportions type production function. [1]
(iii) Law of diminishing returns operates when all factors are variable. [1]
(iv) Initially, total product increases but ultimately falls when there are diminishing returns to a factor. [1]
(v) If AP is falling, MP must also fall. [1]
47. Fill in the blanks: [5]
(i) ________ is defined as the sum total of output produced by a firm by employing a particular input. [1]
(ii) Cost in the short-run can be classified into ________ and variable cost. [1]
(iii) A production function shows the ________ relationship between physical inputs and physical output. [1]

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 (technical/economic)
(iv) Land is a free gift of ________. (nation/nature) [1]
(v) ________ is defined as that period of time in which all the factors of production or inputs are variable. [1]
Question No. 48 to 52 are based on the given text. Read the text carefully and answer the questions: [5]
A farmer uses his land, labour, a tractor, seed, fertilizer, water etc to produce wheat. For simplicity, we assume that the
farmer uses only two inputs to produce wheat: land and labour. A production function tells us the maximum amount of
wheat he can produce for a given amount of land that he uses, and a given number of hours of labour that he performs.
Suppose that he uses 2 hours of labour/ day and 1 hectare of land to produce a maximum of 2 tons of wheat. Then, a
function that describes this relation is called a production function.

48. Which type of relationship studied by production function between physical inputs and output?

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a) Physical b) Technical

c) Economical d) Conceptual

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49. Production function is a relation between firm’s ________.

a) Output, technology
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c) Input, capital d) Output, input

50. The variable factor are those the application of which ________ with the change in output.

a) Both varies and changes

ka b) Varies
ab

c) Changes d) Increases
51. Which value is not considered in the context of production function?
en
dd

a) Market value b) Physical value

c) input value d) Output value

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52. As a ________ farmer is always interested to know how much labour and capital are required to produce a given
quantity of a commodity.

a) All of these b) Intermediator

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c) Producer d) Trader

Question No. 53 to 57 are based on the given text. Read the text carefully and answer the questions: [5]
An increase in the amount of one of the inputs keeping all other inputs constant results in an increase in output. We
measure units of labour along the horizontal axis and output along the vertical axis. With L units of labour, the firm can
at most produce q1 units of output. For the first unit of the variable input, one can easily check that the MP and the AP
are same.

53. As long as the value of MP remains higher than the value of the AP, the AP continues to ________.

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 a) Fall then rises b) Rise

c) Remains constant d) Fall

54. Beyond b point in graph, what is the nature of TP curve?

a) Increasing at decreasing rate b) Decreasing

c) Increasing at increasing rate d) Remains constant

55. Beyond b point in graph, what is the nature of MP curve?

a) Remains constant b) Increases

c) Becomes zero d) Decreases

56. At which point MP becomes zero when TP and MP curves are plotted on same graph as shown?

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a) B b) D

c) A d) C
57. When MP is zero, what will be the nature of TP curve?

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a) Becomes zero b) Remains constant

c) Increases d) Decrease
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58. Find out the missing values from the following table: [6]

Variable Factors 0 1 2 3 4 5 6 7
ka
ab

TP (in units) - - - - 25 - - -

AP (in units) - 5 - - - - - -
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MP (in units) - - 8 4 - 5 0 -4
dd

59. State giving reasons whether the following statements are true or false. [6]
i. Increase in Total Product always indicates that there are increasing returns to a factor.
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ii. When there are diminishing returns to a factor, Marginal Product and Total Product both fall.
iii. Average Product falls only when Marginal Product is less than Average Product.
.
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60. Explain the meaning of increasing returns to a scale and decreasing returns to a scale with the help of total [6]
physical product schedule.
61. Explain the law of variable proportion with the help of diagram/schedule. [6]
62. State giving reasons whether the following statements are true or false. [6]
i. Total Product always increases whether there is increasing returns or diminishing returns to a factor.
ii. When there are diminishing returns to a factor, Total Product always decreases.
iii. Total Product will increase only when Marginal Product increases.
63. Calculate the MP of variable factor and indicate the various phases of Law of Variable Proportions from the [6]
following schedule:

Units of variable factor 0 1 2 3 4 5 6

TP (in units) 0 50 110 150 180 180 150

64. Explain the Law of Variable Proportion with the help of total and marginal physical schedule. [6]
65. Complete the following data. [6]

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 Units of Labour Average Product (A) (units) Marginal Product (Units)

1 8 -

2 10 -

3 - 10

4 9 -

5 - 4

6 7 -

66. Complete the following table: [6]

Marginal Product

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Units of Labour Average Product (Units)
(Units)

1 8 -

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2 10 -

3 - 10
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4 9

5 - 4

6 7 -
ka
ab

67. State the behavior of marginal product in the law of variable proportions. Explain the causes of this behavior. [6]
en
dd
uA
Ed

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