Long run production function vs short run production function ugc net

Описание: In this video, we explain in detail the difference between Return to Scale and Return to Factor, two very important concepts from Production Function that are frequently asked in UGC NET Commerce, Economics, and Management examinations.

Return to Factor is associated with the Short Run Production Function. In the short run, at least one factor of production remains fixed (such as land or capital), while only one factor (generally labour) is variable. Return to factor explains how total output changes when the quantity of the variable factor is increased, keeping other factors constant. It leads to:

Increasing Returns to a Factor

Diminishing Returns to a Factor

Negative Returns to a Factor

This concept is also known as the Law of Variable Proportions.

Return to Scale is associated with the Long Run Production Function. In the long run, all factors of production are variable. Return to scale explains how output changes when all inputs are increased in the same proportion. It includes:

Increasing Returns to Scale

Constant Returns to Scale

Decreasing Returns to Scale

In this lecture, you will clearly understand:

Difference between short run and long run production

Conceptual and exam-oriented comparison of return to factor and return to scale

Key points useful for UGC NET objective and descriptive answers

This video is highly useful for students preparing for UGC NET, NET-JRF, SET, and other competitive exams.

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