The Leontief production function implies:
A) straight-line isoquants.
B) convex-shaped isoquants.
C) A positive MRTS.
D) L-shaped isoquants.

Question

Quizplus · Accepted Answer

The Leontief production function assumes a fixed production ratio between inputs, resulting in L-shaped isoquants. This means that one input cannot be substituted for the other, resulting in a zero MRTS (marginal rate of technical substitution) and a unique optimal input combination.

The Leontief Production Function Implies