A firm's expansion path is:
A) the firm's production function.
B) a curve that makes the marginal product of the last unit of each input equal for each output.
C) a curve that shows the least-cost combination of inputs needed to produce each level of output for given input prices.
D) none of the above

Question

Quizplus · Accepted Answer

The expansion path is a graph that shows the least-cost input combination to produce each level of output given input prices. Therefore, it is represented by a curve that connects the tangency points between isoquants and isocost lines, indicating the most efficient input combination to produce each level of output.

A Firm's Expansion Path Is