Movement from one point to another along an isocost line implies a change in
A)output levels,holding factor combinations constant.
B)factor combinations,holding expenditure constant.
C)factor prices.
D)the level of output,independent of what happens to factor combinations.
E)expenditure.

Question

Quizplus · Accepted Answer

Movement along an isocost line means keeping the expenditure constant and changing the factor combinations. So, option B is correct. Option A is incorrect because output levels are not held constant in this case. Option C is incorrect because factor prices are not changing. Option D is incorrect because factor combinations are changing. Option E is incorrect because expenditure is not changing.

Movement from One Point to Another Along an Isocost Line