# Production and Costs Notes, Class 11 Economics | SwaVid Production and Costs, NCERT Class 11 Economics: notes with key ideas, definitions, common mistakes and 3 quick checks with worked answers. Canonical: https://www.swavid.com/cbse/class-11/economics/chapter/production-and-costs Source: https://www.swavid.com/cbse/class-11/economics/chapter/production-and-costs # Production and Costs ## Definitions, formats and formulas ## Key ideas ## Common mistakes ## Quick checks ## Keep going ## Questions parents ask ## Class 11 Economics on SwaVid ### Production function and time horizons ### Total, average, and marginal product ### Law of variable proportions ### Short-run costs ### Shapes of cost curves ### Long-run costs ### Next chapter ### Related chapter ### All chapters SwaVid › CBSE › Class 11 › Economics › Production and Costs Notes written by SwaVid from the NCERT textbook. Class 11 Economics, Chapter 3. Key ideas, definitions and common mistakes. CBSE does not print marks for a single chapter. Short answer. This chapter explains how a firm transforms inputs into outputs and the monetary expenses incurred in this process. Students learn to analyse production functions, the law of variable proportions, and various short-run and long-run cost curves. Source: NCERT Introductory Microeconomics (Reprint 2026-27) , Chapter 3, Production and Costs A production function shows the maximum output achievable from given combinations of inputs. In the short run, at least one input remains fixed while others vary, but in the long run, all inputs can be changed. Total product is the aggregate output produced with a given amount of inputs. Average product is output per unit of variable input, and marginal product is the addition to total product when one extra unit of variable input is used. When the quantity of one input is increased while other inputs remain fixed, the marginal product of the variable input initially rises, reaches a maximum, and eventually declines. This gives the total product curve an inverse-S shape. Short-run total cost consists of total fixed cost and total variable cost. Average cost is the sum of average fixed cost and average variable cost, while marginal cost is the change in total cost resulting from producing one additional unit. Average fixed cost forms a rectangular hyperbola because total fixed cost remains constant. Average variable cost, short-run average cost, and short-run marginal cost curves are U-shaped, with the marginal cost curve cutting both average curves at their respective minimum points. In the long run, all costs are variable since fixed inputs do not exist. Long-run average cost and long-run marginal cost are both U-shaped, with long-run marginal cost intersecting long-run average cost at its minimum point. Try each question first. Then tap it to see the answer. MP L for the 3rd unit = TP₃ - TP₂ MP L = 30 - 22 = 8 8 units TVC = TC - TFC = 200 - 120 = ₹ 80 AVC = TVC / q = 80 / 4 = ₹ 20 ₹ 20 per unit MC₆ = TC₆ - TC₅ MC₆ = 290 - 250 = ₹ 40 ₹ 40 The Theory of the Firm under Perfect Competition . Market Equilibrium . The 13 chapters of Class 11 Economics . CBSE does not give marks to one chapter. It prints marks for units or parts, and the chapter list page shows them all. No. They are written by SwaVid from the NCERT textbook. The CBSE curriculum is the reference for what is assessed. The Theory of the Firm under Perfect Competition. SwaVid is an AI tutor for Indian students in Classes 6 to 12. It finds the earlier ideas a child missed, then teaches today’s chapter. Start free to see how it works. - Ch 3 NCERT book - 80 marks, theory paper - 3 quick checks - Assuming that total fixed cost changes with the level of output . TFC remains constant at all output levels in the short run, even when output is zero. Only TVC varies with output. - Thinking that marginal cost depends on total fixed cost . Because fixed cost does not change as output changes, ΔTFC is zero. Therefore, MC depends strictly on changes in total variable cost. - Believing that average fixed cost curves can touch an axis . The AFC curve is a rectangular hyperbola that approaches both axes asymptotically but never touches either axis because TFC is positive and output is non-zero. ## Key Links - [CBSE](https://www.swavid.com/cbse) - [Class 11](https://www.swavid.com/cbse/class-11) - [Economics](https://www.swavid.com/cbse/class-11/economics/chapters) - [Start free →](https://www.swavid.com/signup) - [All 13 chapters](https://www.swavid.com/cbse/class-11/economics/chapters) - [NCERT Introductory Microeconomics (Reprint 2026-27)](https://ncert.nic.in/textbook.php) - [Open notes](https://www.swavid.com/cbse/class-11/economics/chapter/the-theory-of-the-firm-under-perfect-competition) - [Open notes](https://www.swavid.com/cbse/class-11/economics/chapter/market-equilibrium) - [Class 11 Economics](https://www.swavid.com/cbse/class-11/economics/chapters) - [Start free →](https://www.swavid.com/signup)