The following are the important properties of equal product curves.

1. Isoquants, like indifference curves, slope downward from left to right (i.e., they have a negative slope). This is so because when the quantity of factor X is increased, the quantity of factor Y must be reduced so as to keep output constant.

2. No two equal product curves can intersect each other. If the two equal product curves, one corresponding to 20 units of output and the other to 30 units of output intersects each other, there will then be a common factor combination corresponding to the point of intersection. It means that the same factor combination which can produce 20 units of output according to one equal product curves can produce 30 units of output according to the other equal product curve. But this is quite absurd. How can the same factor combination produce two different levels of output, techniques of production remaining unchanged.

3. Isoquants, like indifference curves, are convex to the origin. The convexity of equal product curves means that as we move down the curve less and less of factor Y is required to Tie substituted by a given increment of factor X so as to keep the level of output unchanged. Thus, the convexity of equal product curves is due to the diminishing marginal rate of technical substitution.

If the equal product curves were concave to the origin, it would mean that the marginal rate of technical substitution increased as more and more of factor Y was replaced by factor X. This could be valid if the law of increasing returns applied. Since it is the law of diminishing returns which is more true of the real world, the principle of diminishing marginal rate of technical substitution generally holds good and it makes the equal product curves convex to the origin.

Diminishing Marginal Rate of Technical Substitution.

An important characteristic of marginal rate of technical substitution is that it diminishes as more and more of factor Y is substituted by factor X. In other words, as the quantity of factor X is increased and the quantity of factory is reduced, the amount of factor Y that is required to be replaced by an additional unit of factor X so as to keep the output constant will diminish. This is known as the Principle of Diminishing Marginal Rate of Technical Substitution. This principle of diminishing marginal rate of technical substitution is merely an extension of the Law of Diminishing Returns to the relation between the marginal physical productivities of the two factors Along an equal product curve, as the quantity of factor X is increased and the quantity of factor Y is reduced, the marginal physical productivity of X diminishes and the marginal physical productivity of Y increases. Therefore, less and less of factor T is required to be substituted by an additional unit of X so as to maintain the same level of output.