Use the following figure that shows a firm's isoquant for producing 3,000 units of output and four isocost curves. Labor and capital each cost $100 per unit.

-By moving from A to B, the firm _______________ (increases, decreases) labor usage and _______________ (increases, decreases) capital usage. At point B the MRTS is _______________ (greater than, less than, equal to) the input price ratio, w/r. The movement from A to B _______________ (increased, decreased) total cost by $_________.

Question

Use the following figure that shows a firm's isoquant for producing 3,000 units of output and four isocost curves. Labor and capital each cost $100 per unit.

-By moving from A to B, the firm _______________ (increases, decreases) labor usage and _______________ (increases, decreases) capital usage. At point B the MRTS is _______________ (greater than, less than, equal to) the input price ratio, w/r. The movement from A to B _______________ (increased, decreased) total cost by $_________.

Quizplus · Accepted Answer

The Answer of Use the following figure that shows a firm's isoquant for producing 3,000 units of output and four isocost curves. Labor and capital each cost $100 per unit.

-By moving from A to B, the firm _______________ (increases, decreases) labor usage and _______________ (increases, decreases) capital usage. At point B the MRTS is _______________ (greater than, less than, equal to) the input price ratio, w/r. The movement from A to B _______________ (increased, decreased) total cost by $_________.

Use the Following Figure That Shows a Firm's Isoquant for Producing