Input problems
Definition
Input problems refer to situations where factors such as labor, capital, and technology are limited resources used in production. These problems arise when determining how inputs should be allocated efficiently among different production activities.
Analogy
Imagine you have limited ingredients (inputs) to make different dishes. Input problems are like deciding how much of each ingredient should be used for each dish so that you can make the most delicious meals with your limited resources.
Related terms
Production possibilities curve (PPC): A graphical representation that shows all possible combinations of two goods that can be produced given available resources and technology.
Factor market: The market where factors of production such as labor, capital, and land are bought and sold.
Productivity: The measure of output per unit input. It indicates how efficiently inputs are being utilized in the production process.
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