Suppose labor is on the horizontal axis and capital is on the vertical axis.If the wage rate is $15 per worker per hour and the rental rate of capital is $10 per unit per hour,what is the slope of the isocost curve?
A)-0.667
B)-1.5
C)-10
D)-15

Question

Quizplus · Accepted Answer

The slope of the isocost curve is given by: -(w/r) where w is the wage rate and r is the rental rate of capital. Substituting the given values, we get: -(15/10) = -1.5. Therefore, the slope of the isocost curve is -1.5. Option B is the only choice that matches.

Suppose Labor Is on the Horizontal Axis and Capital Is