The production function after Erich good mountain is like the production function after Wassily Leontief a limitationale production function, thus a function, with which only a certain combination of factors of production entails the desired result. Meant that the production coefficients must be always constant, it it cannot vary this typically as a function of the intensity.

Verbrauchsfunktion

Contrary to the production function after Leontief, with which it concerns a special case of the good mountain production function, the production function considers also nonlinear production coefficients after good mountain. Factor consumption can be determined assistance of the Verbrauchsfunktion. This indicates, how many units inputs are needed, in order to supply with an intensity D a unit output x. The Verbrauchsfunktion considers thus the dwindling of assets, which takes place during the enterprise of a plant. Verbrauchsfunktionen can be described by arbitrary mathematical instruments.

The intensity

The intensity D indicates, how input per time unit an enterprise or a plant needs many units. Since the consumption of a factor r is a function of the intensity D, factor-optimal strengths can be determined. Additionally a strength at optimal costs can be computed, if admits the factor prices p are.

Regularities

Factor-optimal intensity

{d_ {opt}} ^ {a_n} = min (a_n (D))

D: Intensity

r_n: Production coefficient n

a_n (D): Verbrauchsfunktion for r_n

Intensity at optimal costs

K (D) = \ sum_ {n=1} ^N {p_n \ cdot a_n (D)}

{d_ {opt}} ^K = min (k (D))

K (D): Cost function

p_n: Price of a unit input

{d_ {opt}} ^K: intensity at optimal costs

Costs per time unit

K = K ({d_ {opt}} ^K) \ cdot x \ cdot t

x: O

t: Number of time units

Articles in category "Good mountain production function"

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