The slope of the isoquant tells the firm how much
A) output increases when labor increases by one unit.
B) output increases when capital and labor are doubled.
C) capital must decrease to keep output constant when labor increases by one unit.
D) a unit of capital costs relative to the cost of labor.

Question

Quizplus · Accepted Answer

The slope of the isoquant represents the rate at which capital must decrease to keep output constant when labor increases by one unit, indicating the trade-off between capital and labor while maintaining the same level of production.

The Slope of the Isoquant Tells the Firm How Much