1. The iso-quant curve has negative
It slopes downwards from left
to right indicating that the factors are substitutable. If more of one factor is used, less of the other factor is needed for producing the same level of output. In the diagram combination A refers to more of capital K5 and less of labour L2 . As the producer moves
to B, C, and D, more labour and less
capital are used.
2. Convex to the origin:
This explains the concept of diminishing Marginal Rate of Technical Substitution (MRTSLK). For example, the capital substituted by 1 unit of labour goes on decreasing when moved from top to bottom. If so, it is called diminishing MRTS. Constant MRTS (straight line) and increasing MRTS (concave) are also possible. It depends on the nature of iso-quant curve. This means that factors of production are substitutable to each other. The capital substituted per unit of labour goes on decreasing when the iso-quant is convex to the origin.
3. Non inter-section of Iso-quant
For instance, point A lie on the iso-quants IQ1 and IQ2. But the point C shows a higher output and the point
B shows a lower level of output IQ1.
If C=A, B=A, then C=B. But C>B
which is illogical.
4. An upper iso-quant curve represents a higher level of output:
Higher IQs show higher outputs
and lower IQs show lower outputs, for upper iso-quant curve implies the use
of more factors than the lower isoquant curve.The arrow in the figure shows an increase in the output with a right and upward shift of an iso-quant curve.
5. Iso-quant curve does not touch
either X axis or Y axis:
No iso-quant curve touches the X axis or Y axis because in IQ1, only capital is used,and in IQ2 only labour is used.