When isocost lines shift outward from the origin, it represents:
A)increasing levels of expenditure on the inputs to the production process.
B)increasing sunk costs
C)increasing opportunity costs
D)decreasing levels of expenditure on the inputs to the production process.

Question

Quizplus · Accepted Answer

Isocost lines represent different levels of cost for producing a certain amount of output. When the lines shift outward from the origin, it means that the cost of producing that output has increased. This is because there is now a higher level of expenditure required on the inputs to the production process. When isocost lines shift outward from the origin, it represents increasing levels of expenditure on the inputs to the production process. This means that the cost of producing the same level of output has increased, which can be due to several factors such as an increase in the price of inputs or an increase in the quantity of inputs used.

When Isocost Lines Shift Outward from the Origin, It Represents