A firm can minimize cost by
A) picking the bundle of inputs where the lowest isocost line touches the isoquant.
B) picking the bundle of inputs where the isoquant is tangent to the isocost line.
C) picking the bundle of inputs where the last dollar spent on one input gives as much extra output as the last dollar spent on any other input.
D) All of the above.
D
You might also like to view...
On the graph above, suppose the economy is at point F when there is a temporary negative supply shock. The new long-run equilibrium is at point ________
A) H B) I C) F D) G E) none of the above
If aggregate supply rises sharply so that a recession occurs, then the prescription is for expansionary fiscal policy
Select whether the statement is true or false. A. True B. False
Suppose an entrepreneur commits to a production schedule but underestimates the market price for his products. What will be true about his current level of production?
a. Losses will be very high. b. Marginal cost will be less than marginal revenue. c. Marginal cost will be more than marginal revenue. d. Average total cost will exceed price. e. Total fixed costs will be too low.
Shrimp is an increasingly popular part of the American diet. Louisiana shrimpers who represent the bulk of the U.S. industry were almost all put out of business by Hurricane Katrina. How did the hurricane affect the equilibrium price and quantity of
shrimp? What will be an ideal response?