It shows how cost of production vary with change in output when one factors is fixed.
It shows how producers substitute one factor of production from the other when the relative price of factors changes and marginal productivity remains unchanged.
When the producer is exprecing, increasing returns to the variety factor, more of the variable factor should be added.
The law explains why more capital is combined with a given amount of goods in different countries
It experiences decreasing return to be variable factor less variable factor should be used.
