The short-run expansion path is the curve containing the tangency points between the isocost curves and the isoquants, presenting the set of input combinations that produces any given output level at the least cost.

Question

Quizplus · Accepted Answer

The short-run expansion path contains the input combinations that a firm uses to produce different levels of output at the least cost, but it assumes that one or more inputs are fixed, not variable. The curve you described, containing the tangency points between isocost curves and isoquants for variable input combinations, refers to the long-run expansion path.

The Short-Run Expansion Path Is the Curve Containing the Tangency