expansion path shows how
A)input prices change as the firm's output level changes.
B)the marginal products change as the firm's output level changes.
C)the cost-minimizing input choices change as the firm's output level changes.
D)the profit-maximizing input choices change as the firm's output level changes.
E)the cost-minimizing input prices change as the firm's output level changes.

Question

Quizplus · Accepted Answer

The expansion path shows how the cost-minimizing input choices change as the firm's output level changes. It illustrates how the firm selects its optimal combination of inputs at each level of output along the expansion path, given the prices of the inputs. Therefore, C is the correct choice.

Expansion Path Shows How