Production function is a concept in economics that describes the relationship between inputs (factors of production) and the output of goods and services.
In order to produce any commodity, we need three main inputs, land, labour and capital. To produce a specific commodity, the calculation of application of each of these factors is essential.
The functional relationship between input and output can be expressed in the following way:
Q = f(L,K,…)
Which means,
Q (Production of goods x ) is the function of L (labour) and K (Capital).
Fixed VS. Variable Factors
Fixed factors:
Fixed factors of production are those which help in production but cannot be changed immediately, like plant and machinery. The output that can be obtained from the application of such plants & machinery also stays constant and can only be changed in the long run. For example, a printing machine has the capacity to print 1000 pages in a day. This means that 1000 is the maximum capacity of the machine. Similarly, if a piece of land that can produce rice is 1 ton then, the output from such land cannot be increased beyond 1 ton.
Variable Factors:
Variable factors of production are those factors which can vary or can be changed according to requirement. For example, Labour can be increased or decreased according to the requirement and a change in it causes a direct change in the output. For example, if you want to increase the output, you can do so in the short run by increasing your labour.
In the short run, the production function of any firm consists of both fixed and variable factors. And in the long run, all the factors are variable.