The following figure shows the isoquants,IQ 1 and IQ 2 ,for a competitive firm.
Figure 16-1
-Refer to Figure 16-1.As compared to point B,the firm uses _____ at point A.
A)less labor and more capital
B)more labor and less capital
C)less capital and labor
D)more capital and labor

Question

The following figure shows the isoquants,IQ 1 and IQ 2 ,for a competitive firm.
Figure 16-1 
-Refer to Figure 16-1.As compared to point B,the firm uses _____ at point A.
A)less labor and more capital 
B)more labor and less capital 
C)less capital and labor 
D)more capital and labor

Quizplus · Accepted Answer

Point A is to the right and above point B, which means it requires more output. This can only be achieved by using more inputs, specifically more labor and less capital. Therefore, the firm uses more labor and less capital at point A compared to point B.

The Following Figure Shows the Isoquants,IQ1 and IQ2,for a Competitive

The Following Figure Shows the Isoquants,IQ₁ and IQ₂,for a Competitive