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jack103106 jack103106
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A year ago

The figure below shows the isocost lines and the isoquant map for a firm producing golf tees.

Short description: A graph plots the quantity of L against the quantity of K. Long description: The horizontal axis represents the quantity of L. The vertical axis represents the quantity of K. The graph shows four lines and four curves. The first line representing TC equals 40 dollars begins at (0, 8) and ends at (20, 0). The second line representing TC equals 60 dollars begins at (0, 12) and ends at (30, 0). The third line representing TC equals 80 dollars begins at (0, 16) and ends at (40, 0). The fourth line representing TC equals 100 dollars begins at (0, 20) and ends at (50, 0). The curve representing Q equals 1000 passes through A (10, 5) and B (19, 3). It intersects the first line at A. The curve representing Q equals 2000 passes through C (15, 6) and D (25, 5). It intersects the second line at C. The curve representing Q equals 3000 passes through E (25, 9) and F (28, 6.5). It intersects the third line at E. The curve representing Q equals 4000 passes through G (25, 10) and H (35, 9.5). It intersects the third line at G. Note: all values are approximate.

FIGURE 8-5
Refer to Figure 8-5. At each of points A, C, E and G on the isoquant map we know that



▸ the firm has adjusted the factor prices to equate the ratio of marginal products of the factors.

▸ the firm can adjust its employment of factors to reduce its total cost, with output unchanged.

▸ the ratio of the marginal products of capital and labour is equal to the ratio of the prices of capital and labour.

▸ the firm is at its cost-minimizing position for an output level of 4000 golf tees.

▸ the ratio of the marginal utilities of capital and labour is equal to the ratio of the prices of capital and labour.
Textbook 
Microeconomics

Microeconomics


Edition: 17th
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Gimor1220Gimor1220
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jack103106 Author
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A year ago
Good timing, thanks!
ouasfoudgewu
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Yesterday
Thanks
Hellish Lover
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2 hours ago
Thanks for your help!!
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