Fixed and Variable factors

Fixed and Variable factors - according to the varying...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Fixed and Variable factors: In the act of production a firm uses a variety of goods and services called factors of production or inputs . These factors and services include plant and machinery, factory premises, tools and equipment, land, raw materials, labor etc. Some of these factors are fixed in size. A machine or manager has to be employed in its full capacity, irrespective of the volume of the output. Other factors like labor and raw materials can be employed in small or large units
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: according to the varying quantity of output. These are variable factors of production. Fixed factors are indivisible while variable factors are divisible into small units. Fixed factors are supplementary in nature . Machines make productive activity more convenient and efficient. However, even in their absence, output of some volume can be produced . Variable factors are called prime factors without which no output can be produced....
View Full Document

Ask a homework question - tutors are online