Refer to the information provided in Figure 7.12 below to answer the questions that follow. Figure 7.12
-Refer to Figure 7.12. If the firm's cost of capital is $30 per unit and its cost of labor is $60 per unit, the isocost line represents a total cost of
A) $2,000.
B) $3,000.
C) $6,000.
D) $8,000.

Question

Refer to the information provided in Figure 7.12 below to answer the questions that follow.  Figure 7.12
-Refer to Figure 7.12. If the firm's cost of capital is $30 per unit and its cost of labor is $60 per unit, the isocost line represents a total cost of
A) $2,000. 
B) $3,000. 
C) $6,000. 
D) $8,000.

Quizplus · Accepted Answer

The isocost line equation is given by the total cost = (cost of capital * quantity of capital) + (cost of labor * quantity of labor). If the cost of capital is $30 per unit and the cost of labor is $60 per unit, and assuming the isocost line represents a total cost of $6,000, the equation would be 30K + 60L = 6,000, which fits the given costs.

Refer to the Information Provided in Figure 7