A production function ?
Correct answer: B. depicts the relationship between input and output
- A. shows the dependency output of the working population
- B. depicts the relationship between input and output
- C. states the relationship between products and income distribution
- D. is a function of natural resources in a country
Explanation
A production function shows the technical relationship between inputs used and the maximum output that can be produced with them. It does not describe income distribution or merely depend on natural resources.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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