If the price of just one input rises, a cost- maximizing firm that maintains a constant level of output will use less of the higher- priced input:
A) if the substitution effect outweighs the output effect.
B) and all other inputs.
C) if the output effect outweighs the substitution effect.
D) in all cases.
Correct Answer:
Verified
Q13: If a firm is producing at minimum
Q14: The Marginal Rate of Technical Substitution diminishes
Q15: The cost function, TC(y), shows the:
A)linear pattern
Q16: What the cheapest input bundle for producing
Q17: If a firm is producing at minimum
Q19: If a firm's production function is f(z1,z2)=
Q20: Suppose MTRS =MPL/MPK=1/3. If we want to
Q21: A normal input is:
A)one that is a
Q22: An isoquant may be defined as a
Q23: If the production function is f(z1,z2)= min(z1,z2)and
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents