CBSE Class 12 Economics Production Function Worksheet

Read and download free pdf of CBSE Class 12 Economics Production Function Worksheet. Download printable Economics Class 12 Worksheets in pdf format, CBSE Class 12 Economics Part A Microeconomics Chapter 3 Production and Costs Worksheet has been prepared as per the latest syllabus and exam pattern issued by CBSE, NCERT and KVS. Also download free pdf Economics Class 12 Assignments and practice them daily to get better marks in tests and exams for Class 12. Free chapter wise worksheets with answers have been designed by Class 12 teachers as per latest examination pattern

Part A Microeconomics Chapter 3 Production and Costs Economics Worksheet for Class 12

Class 12 Economics students should refer to the following printable worksheet in Pdf in Class 12. This test paper with questions and solutions for Class 12 Economics will be very useful for tests and exams and help you to score better marks

Class 12 Economics Part A Microeconomics Chapter 3 Production and Costs Worksheet Pdf

Worksheet on Production Function 
 

Question. If the inputs of all but one factor are held constant, then Total Factor will —
(a) Remain constant
(b) Become zero
(c) Vary with the quantity used of the Variable Factor.
(d) Become infinity
Answer: C

Question. If Total Product = 1,00,000 units when 20,000 hours of Labour are used, then Total Product =
(a) 1,00,000
(b) 20,000
(c) 5
(d) 1,20,000
Answer: A

Question. Production Function specifies the output that can be produced with given quantities of inputs, in the existing state of technology.
(a) Minimum
(b) Maximum
(c) Average
(d) Zero
Answer: B

Question. Law of Variable Proportions is applicable to —
(a) Medium—run
(b) Short —run
(c) Long—run
(d) All of the above
Answer: B

Question. If Total Product = 1,00,000 units when 20,000 hours of Labour are used, then Average Product=
(a) 1,00,000
(b) 20,000
(c) 5
(d) 1,20,000
Answer: C

Question. As quantity of the Variable Factor increases, Total Product (TP) Curve —
(a) Always increases
(b) Always decreases
(c) First increases, reaches a maximum, and then decreases.
(d) First decreases, reaches a minimum, and then increases.
Answer: C

Question. If Marginal Product (MP) Curve is depicted on a graph with Quantity on X axis —
(a) MP will not go below the X axis.
(b) MP may go below the X axis.
(c) MP cannot be depicted on the graph at all.
(d) None of the above
Answer: B

Question. If Total Product (TP) increases at an increasing rate, Marginal Product (MP) will be —
(a) Increasing
(b) Decreasing
(c) Zero
(d) Infinity
Answer: A

Question. Marginal Product (MP) Curve cuts Average Product (AP) Curve —
(a) From above
(b) From below
(c) MP does not cut AP at all
(d) Nothing can be said
Answer: A

Question. is the change in Total Product, for one unit change in the quantity of Variable Factor.
(a) Total Product
(b) Average Product
(c) Marginal Product
(d) All of the above
Answer: C

Question. If Total Product (TP) increases at a decreasing rate, Marginal Product (MP) will be —
(a) Increasing
(b) Decreasing
(c) Zero
(d) Infinity
Answer: B

Question. When is Average Product at its maximum?
(a) When AP intersects MP
(b) When AP intersects TP
(c) At the Point of Inflexion
(d) All of the above
Answer: A

Question. At the Point of Inflexion, the Marginal Product is —
(a) Increasing
(b) Decreasing
(c) Maximum
(d) Negative
Answer: C

Question. Marginal Product is —
(a) The change in Total Product, for one unit change in the quantity of Variable Factor.
(b) The addition made to Total Product, by an additional unit of input of the Variable Factor
(c) Both (a) and (b)
(d) Neither (a) nor (b)
Answer: C

Question. The Marginal, Average, and Total Product Curves encountered by the Firm producing in the short run exhibit all of the following relationships except —
(a) When Total Product is rising, Average and Marginal Product may be either rising or falling
(b) When Marginal Product is negative, Total Product and Average Product are falling
(c) When Average Product is at a maximum, Marginal Product equals Average Product, and Total Product is rising
(d) When Marginal Product is at a maximum, Average Product equals Marginal Product, and Total Product is falling
Answer: D

Question. Marginal Product (MP) Curve —
(a) Is parallel to X Axis
(b) Is parallel to Y Axis
(c) First decreases, reaches a minimum, and then increases
(d) First increases, reaches a maximum, and then decreases
Answer: D

Question. Average Product (AP) Curve —
(a) Is parallel to X Axis
(b) Is parallel to Y Axis
(c) First decreases, reaches a minimum, and then increases
(d) First increases, reaches a maximum, and then decreases
Answer: D

Question. If Total Product (TP) is maximum, Marginal Product (MP) will be —
(a) Positive
(b) Negative
(c) Zero
(d) Infinity
Answer: C

Question. The introduction of new product with added features in the market is known as —
(a) Process Innovation
(b) Product Innovation
(c) Plant Innovation
(d) Production Function
Answer: B

Question. When Average Product (AP) rises as a result of an increase in the quantity of variable input —
(a) MP < AP
(b) MP = AP
(c) MP > AP
(d) There is no relationship between MP and AP
Answer: C

Question. When Marginal Product (MP) = Average Product (AP), it means that AP is —
(a) At its maximum
(b) At its minimum
(c) Zero
(d) Infinity
Answer: A

Question. Which of the following statements regarding Product and Process Innovation is true?
(a) It is difficult to quantify product innovation, as compared to process innovation
(b) It is difficult to quantify process innovation, as compared to product innovation
(c) Neither of the innovation types can quantified
(d) Quantifying both the innovation types is equally easy / difficult
Answer: A

Question. What is the maximum point of TP?
(a) When AP becomes zero
(b) When MP becomes zero
(c) At the intersecting point of AP & MP
(d) None of these
Answer: B

Question. .. is the addition made to Total Product, by an additional unit of input of the Variable Factor.
(a) Total Product
(b) Average Product
(c) Marginal Product
(d) All of the above
Answer: C

Question. At the Point of Inflexion, TP will generally —
(a) Show increasing trend
(b) Show decreasing trend
(c) Equal to zero
(d) Be negative
Answer: A

Question. If TP decreases, MP will be —
(a) Positive
(b) Negative
(c) Zero
(d) Infinity
Answer: B

Question. When Average Product (AP) decreases as a result of an increase in the quantity of variable input —
(a) MP is more than AP.
(b) MP is less than AP.
(c) MP = AP
(d) There is no relationship between MP and AP
Answer: B

Question. In the stage of Negative Marginal Returns, Total Product (TP) —
(a) Remains constant
(b) Increases
(c) Decreases
(d) Remains at zero.
Answer: C

Question. The stage of Increasing Returns applies from ............ to .................
(a) Origin to Point where AP is maximum
(b) Point where AP is maximum to Point when TP is maximum
(c) Point when TP declines and and MP becomes negative.
(d) All the above
Answer: A

Question. As per Law of Variable Proportions, as the quantity of one input which is combined with other fixed inputs is increased , theof the Variable Input must eventually decline.
(a) Total productivity
(b) Average productivity
(c) Marginal Productivity
(d) All the above
Answer: C

Question. In the , all factors of production cannot be increased or decreased simultaneously.
(a) Medium—run
(b) Short —run
(c) Long—run
(d) All of the above
Answer: B

Question. The order of stages in the Law of Variable Proportions are —
(a) Increasing Returns, Negative Marginal Returns, Diminishing Returns
(b) Increasing Returns,Diminishing
(c) Negative Marginal Returns, Increasing Returns, Diminishing Returns
(d) Diminishing Returns, Negative Marginal Returns, Increasing Returns
Answer: B

Question. The Law of Variable Proportions analyses the economic profitability of the Firm in monetary terms also. This statement is —
(a) True
(b) False
(c) Partially True
(d) None of the above
Answer: B

Question. The Law of Diminishing Returns —
(a) States that beyond some level of a that variable input begins to increase steadily.
(b) Assumes that there is technological improvement over time.
(c) States that beyond some level of a variable input, the Marginal Product of that Variable input begins to decrease steadily.
(d) Informs a Firm whether or not to use a factor input.
Answer: C

Question. Assumption which are applicable under Law of Variable Proportion are—
(a) State of technology is constant
(b) Quantities of some inputs is kept fixed
(c) Economic profitability in monetary terms is not considered
(d) All of these
Answer: D

Question. In case of law of variable proportions, diminishing returns occur.
(a) When units of a variable input are added to a fixed input and total product falls
(b) When units of a variable input are added to a fixed input and marginal product falls
(c) When the size of the plant is increased in the long run.
(d) When the quantity of the fixed input is increased and returns to the variable input falls.
Answer: B

Question. In which of the following situations, the Law of Variable Proportions will not apply?
(a) Scarcity of Fixed Factor of Production
(b) Availability of Perfect Substitutes for the Fixed Factor
(c) Change in proportions in which Factors are used
(d) Same level of technology
Answer: B

Question. Which of the following stages of production is known as stage of Negative Returns?
(a) When AP is Negative
(b) When MP is decreasing
(c) When MP is Negative
(d) Both (a) and (b)
Answer: C

Question. In case of , MP and AP may rise instead of falling.
(a) Constant State of Technology
(b) Improvement in Technology
(c) Erosion / Reduction in Technology
(d) All of the above
Answer: B

Question. The Law of deals with input—output relationship, when the output is increased by varying the quantity of one input.
(a) Variable Proportions
(b) Suppl y
(c) Demand
(d) Returns to Scale
Answer: A

Question. Why does the Law of Increasing Returns operate?
(a) Full Use of Fixed Indivisible Factors
(b) Efficiency of Variable Factors
(c) Need to reach the right combination
(d) All of the above
Answer: D

Question. In the stage of Diminishing Returns —
(a) MP increases but AP decreases
(b) MP decreases but AP increases
(c) MP and AP show increasing trend
Answer: D

Question. states that when Labour increases with capital being the same, the Marginal Productivity of Labour will increase at first but start decreasing later.
(a) Law of Equi—Marginal Returns
(b) Law of Diminishing Marginal Utility
(c) Law of Variable Proportions
(d) Law of Constant Returns
Answer: C

Question. Law of Diminishing Returns is not relevant when—
(a) All labourers are equally efficient
(b) The time period is short
(c) All factory inputs are increased by the same proportion
(d) Technology remains constant
Answer: C

Question. Which of the following is not a stage in Law of Variable Proportions?
(a) Increasing Returns
(b) Constant Returns
(c) Diminishing Returns
(d) Negative Returns
Answer: B

Question. Which of the following is an assumption in the Law of Variable Proportions?
(a) The state of technology is constant and unchanged
(b) Only physical quantities of inputs and outputs are considered
(c) Only one factor input is considered variable, while all other factors are fixed
(d) All of the above
Answer: D

Question. In which stage of production are the Average Product and Marginal Product decreasing with the Marginal Product above zero (positive)?
(a) In the stage of Constant Returns
(b) In the stage of Decreasing Returns
(c) In the stage of Increasing Returns
(d) Both (a) and (c)
Answer: B

Question. When the Law of Diminishing Returns sets in, then—
(a) Marginal Cost falls at a decreasing rate
(b) Marginal Cost falls at an increasing rate
(c) Marginal Cost falls at a constant rate
(d) Marginal Cost increases
Answer: D

Question. The Law of Variable Proportions is drawn under all of the assumptions mentioned below except the assumption that —
(a) The Technology is changing
(b) There must be some inputs whose quantity is kept fixed
(c) We consider only physical inputs and not economically profitability in monetary terms
(d) The technology is given and stable
Answer: A

Question. Diminishing Returns occur—
(a) When units of a variable input are added to a fixed input and Total Product falls.
(b) When units of a variable input are added to a fixed input and Marginal Product falls
(c) When the size of the Plant is increased in the long run
(d) When the quantity of the fixed input is increased and returns to the Variable Input fails
Answer: B

Question. In which stage of production would a rational entrepreneur like to operate?
(a) Stage 1 where MP is maximum
(b) Stage 2 where both MP and AP are decreasing, but both are positive
(c) Stage 3 where MP is negative
(d) Either Stage 2 or 3
Answer: B

Question. Diminishing Marginal Returns implies —
(a) Decreasing Average Variable Costs
(b) Decreasing Marginal Costs
(c) Increasing Marginal Costs
(d) Decreasing Average Fixed Costs
Answer: C

Question. The Third Stage of Law of Variable Proportion is known as—
(a) Law of Negative Returns
(b) Law of Decreasing Returns
(c) Law of Diminishing Returns
(d) All of these
Answer: A

Question. The Law of Variable Proportions come into being when—
(a) There are only two variable factors.
(b) There is a fixed factor and a variable factor.
(c) All factors are variable.
(d) Variable factors yield less.
Answer: B

Question. The stage of Diminishing Returns applies from ............. to .................
(a) Origin to Point where AP ismaximu m
(b) Point where AP is maximum to Point when TP is maximum
(c) Point when TP declines and and MP becomes negative.
(d) All the above
Answer: B

Question. In the stage of Diminishing Returns, Total Product (TP) —
(a) Remains constant
(b) Increases
(c) Decreases
(d) Becomes negative
Answer: B

Question. In the stage of Negative Marginal Returns, Average Product (AP) —
(a) Remains constant
(b) Decreases
(c) Becomes negative
(d) Increases
Answer: B

Question. In which of the following situations, the Law of Variable Proportions will not apply?
(a) Improvement in technology
(b) When all factors are proportionately varied
(c) Where the factors must be used in fixed proportions to yield the product
(d) All of the above
Answer: D

If Stage I = Increasing Returns, Stage II = Diminishing Returns, and Stage III = Negative Marginal Returns, answer the next 6 questions.

Question. Stages I and III are called —
(a) Economic Absurdity
(b) Economic Stability
(c) Economic Equilibrium
(d) All of the above
Answer: A

Question. A Rational Producer will not operate in
(a) There is more scope for making the best use of the Fixed Factor
(b) Total Output still shows an increasing trend
(c) Optimal Combination of Fixed and Variable Factors is not yet achieved
(d) All of the above
Answer: D

Question. A Rational Producer will operate in —
(a) Stage I
(b) Stage II
(c) Stage III
(d) All of the above
Answer: C

Question. A Rational Producer will not operate in Stage III due to the reason that—
(a) The Fixed Factor has become over— used and inefficient
(b) There is a reduction in Total Output
(c) The MP of the Variable Factor is negative
(d) All of the above
Answer: D

Question. A Rational Producer will not operate in —
(a) Stages I and II
(b) Stages II and III
(c) Stages III and I
(d) All of the above
Answer: C

Question. A Rational Producer intends to work in—
(a) Stage of Constant Returns
(b) Stage of Increasing Returns
(c) Stage of Diminishing Returns
(d) Stage of Negative Returns
Answer: C

Question. If Average Product (AP) Curve is depicted on a graph with Quantity on X axis —
(a) AP will not go below the X axis.
(b) AP may go below the X axis.
(d) None of the above
Answer: A

Question. Which of the following is correct?
(a) If Marginal Product is positive and falling, Total Product will rise at a decreasing rate.
(b) Total Product divided by Quantity of Variable Factor equals Average Product.
(c) Marginal Product and Average Product can be calculated from Total Product.
(d) All of the above.
Answer: D

Question. The Marginal Product of an input is
(a) Extra product produced by one extra unit of input while other inputs are held constant
(b) Extra product produced by reducing one unit of input while other inputs are held constant
(c) Reduction in total product due to one extra unit of input while other inputs are held constant
(d) Reduction in total product by reducing one unit of input while other inputs are changing.
Answer: A

Question. When Average Product (AP) decreases as a result of an increase in the quantity of variable input —
(a) MP < AP
(b) MP = AP
(c) MP > AP
(d) There is no relationship between MP and AP
Answer: A

Question. When Average Product (AP) decreases as a result of an increase in the quantity of variable input —
(a) MP < AP
(b) MP = AP
(c) MP > AP
(d) There is no relationship between MP and AP
Answer: A

Question. If the Marginal Product of Labour is below the Average Product of Labour, it must be true that
(a) The Marginal Product of Labour is negative
(b) The Marginal Product of Labour is zero
(c) The Average Product of Labour is falling
(d) The Average Product of Labour is negative
Answer: C

Question. When Average Product (AP) is at its maximum
(a) MP < AP
(b) MP > AP
(c) MP = 0
Answer: B

Question. At what point is the Marginal Product maximum?
(a) Turning Point
(b) Equilibrium Point
(c) Focal Point
(d) Inflexion Point
Answer: D

Question. What is the relationship between AP and MP?
(a) AP and MP both rise first and thereafter fall
(b) MP Curves always lies half—way between AR Curve and Origin
(c) AP and MP both can be zero or negative
(d) All of these
Answer: A

Question. When AP rises as a result quantity of variable input —
(a) MP is more than AR
(b) MP is less than AP
(c) MP = AP
(d) There is no relationship between MP and AP
Answer: A

Question. Marginal Product (MP) Curve cuts Average Product (AP) Curve —
(a) MP = AP
(b) AP is maximum
(c) MP is fal l ing
(d) All of the above
Answer: D

Question. At the Point of Inflexion —
(a) Total Product is maximum
(b) Average Product is maximum
(c) Marginal Product is maximum
(d) All of the above
Answer: C

Let TP = Total Product, AP = Average Product and MP = Marginal Product. Use the following table and answer the next 10 Questions. 
cbse-class-12-economics-production-function-worksheet

Question. Find the value of "C" in the above Table.
(a) 1,000
(b) 1,300
(c) 1,600
(d) 1,900
Answer: C

Question. Find the value of "H" in the above Table.
(a) Nil
(b) 1,000
(c) 2,000
(d) Cannot be calculated
Answer: A

Question. Find the value of "B" in the above Table.
(a) 1,000
(b) 2,000
(c) 3,000
(d) 0
Answer: A

Question. Find the value of "G" in the above Table.
(a) 500
(b) 525
(c) 550
(d) 575
Answer: B

Question. Find the value of "I" in the above Table.
(a) Nil
(b) 1,000
(c) 2,000
(d) Cannot be calculated
Answer: C

Question. Find the value of "D" in the above Table.
(a) 1,000
(b) 800
(c) 600
(d) 400
Answer: B

Question. Find the value of "E" in the above Table.
(a) 1,100
(b) 1,600
(c) 1,700
(d) 2,100
Answer: D

Question. Find the value of "F" in the above Table.
(a) 500
(b) 600
(c) 800
(d) None of these
Answer: A

Question. Find the value of "A" in the above Table.
(a) 1,000
(b) 2,000
(c) 3,000
(d) 0
Answer: A

Question. Find the value of "3" in the above Table.
(a) Nil
(b) — 100
(c) + 100
(d) Cannot be calculated
Answer: B

Read the Table below & answer the following 8 questions
cbse-class-12-economics-production-function-worksheet

Question. If Labour Input = 4, output per worker is:
(a) 20
(b) 35
(c) 45
(d) 90
Answer: B

Question. The firm's output is at a short run maximum at a Labour Input of :
(a) 2
(b) 3
(c) 4
(d) 6
Answer: C

Question. If Labour Input = 1, Total Output is—
(a) 25
(b) 30
(c) 50
(d) 75
Answer: A

Question. If Labour Input = 2, Marginal Product is—
(a) 25
(b) 90
(c) 6 5
(d) 115
Answer: C

Question. When Labour Input = 5, Marginal Product is—
(a) 20
(b) 120
(c) 0
(d) -120
Answer: C

Question. If Labour Input = 6, the marginal product of labour is:
(a) 120
(b) — 20
(c) 15
(d) 10
Answer: B

Question. Output per worker is maximized at a Labour Input of:
(a) 2
(b) 4
(c) 6
(d) 8
Answer: A

Question. At what level of Labour Input are MP and AP equal?
(a) 1
(b) 2
(c) 3
(d) 4
Answer: A

Use the following information to answer next 3 questions 
cbse-class-12-economics-production-function-worksheet

Question. What is the Marginal Product of the third hour of Labour?
(a) 60
(b) 80
(c) 100
Answer: A

Question. What is the Average Product of the first three hours of Labour?
(a) 60
(b) 80
(c) 100
(d) 240
Answer: B

Question. What is the Total Output when 2 hours of Labour are employed?
(a) 80
(b) 100
(c) 180
(d) 200
Answer: C

 
Very Short-Answer Questions (1 mark each)
 
1. What is production function?
 
2. Define the following terms:
a) Total Physical product
b) Marginal Physical product
c) Average Physical Product
 
3. What happens to MPP when TPP is rising?
 
4. What happens to TPP when MPP is diminishing?
 
5. What happens to TPP when MPP becomes negative?
 
Short-Answer Questions (3/4 marks each)
 
1. Distinguish between fixed factors and variable factors
 
2. Differentiate between short period and long period.
 
3. Explain relationship between APP and MPP.
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4. Explain relationship between TPP and MPP.
 
5. Explain law of diminishing marginal returns.
 
6. State Reasons for operation of increasing returns.
 
7. Identify different phases of returns to factor proportion from the following schedule. Give reasons.

CBSE Class 12 Economics Production Function Worksheet 1

8. Calculate APP and MPP of a factor from the following table of TPP schedule

CBSE Class 12 Economics Production Function Worksheet 2

9. The following table gives MPP of a factor. It is also known that TPP at zero level of employment is zero. Determine its TPP and APP schedules.
 
CBSE Class 12 Economics Production Function Worksheet 3
 
10. The following table gives APP of a factor. It is also known that the TPP at zero level of employment is zero. Determine TPP and MPP schedules.
 
CBSE Class 12 Economics Production Function Worksheet 4
 
Long-Answer Questions (6 marks each)
 
1. Show with the help of a schedule and a diagram the relationship between TP, AP and MP.
 
2. State and explain the law of variable proportion in terms of changes in the marginal physical product.
 
 

Please click on below link to download CBSE Class 12 Economics Production Function Worksheet

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