A reduction in a firm's operating budget is represented as a shift of its isocost line inward to a parallel position.

Name: A reduction in a firm's operating budget is represented as a shift of its isocost line inward to a parallel position.
Brand: Quizplus
Rating: 4.8 (38 reviews)

Question

Quizplus · Accepted Answer

A reduction in a firm's operating budget means a decrease in the total amount of money available for inputs. This will lead to a parallel inward shift of the isocost line, reflecting the decreased budget constraints.

A Reduction in a Firm's Operating Budget Is Represented as a Shift