Refer to the information provided in Figure 7.11 below to answer the question(s) that follow. Figure 7.11
-Refer to Figure 7.11. If the firm's cost of capital is $24 per unit and its cost of labor is $48 per unit, the isocost line represents a total cost of
A) $2,400.
B) $3,600.
C) $4,800.
D) $7,200.

Question

Refer to the information provided in Figure 7.11 below to answer the question(s) that follow.  Figure 7.11
-Refer to Figure 7.11. If the firm's cost of capital is $24 per unit and its cost of labor is $48 per unit, the isocost line represents a total cost of
A) $2,400. 
B) $3,600. 
C) $4,800. 
D) $7,200.

Quizplus · Accepted Answer

The isocost line equation is TC = (Cost of Capital × Quantity of Capital) + (Cost of Labor × Quantity of Labor). Without the figure, we can use the given costs per unit to determine the total cost. If the cost of capital is $24 per unit and the cost of labor is $48 per unit, and assuming the isocost line represents a combination of capital and labor that equals a specific total cost, we need to find a total cost that fits these unit costs. The correct answer must be derived from specific information or a given equation, but without the figure or additional data, the most logical approach is to understand that the total cost (TC) is a function of the costs of capital and labor. Given the options, $4,800 could be a plausible total cost for a combination of capital and labor at the given rates, assuming the quantities of capital and labor align with this total cost in a way that fits typical examples or problems of this nature.

Refer to the Information Provided in Figure 7