What do you mean by kinked isoquant, Managerial Economics

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Q. What do you mean by Kinked Isoquant?

This isoquant presumes only limited substitutability of labour andcapital. There are just a few processes for generating any one commodity.

This is demonstrated in Figure below where A1, A2, A3 and A4 represent the production process and Q is the kinked isoquant. In this case O substitutability of factors is possible only at the kinks.

2386_What do you mean by Kinked Isoquant.png

Fig: Kinked Isoquant

This is more realistic kind of isoquant since managers, engineers and production executives consider the production process as a discrete in place of continuous process.


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