On an isoquant/isocost graph, the least cost input combination of producing a given output is
A) given by the tangency between the isoquant curve and the isocost line.
B) any point on the isocost line.
C) any point on the isoquant curve.
D) one of the intercept values on the graph.
A
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What is the effect of important restrictions on prices?
a) they cause prices to drop b) they cause prices to rise c) they often cause prices to rise steeply and then drop d) they usually do not have any lasting effect on price
A pharmaceutical company faces a price regulation where it cannot charge any higher than $5,000 for a lifesaving drug. The company knows that the patients put a high value on this product and are willing to pay up to $10,000 for it. The company decides
to sell the drug at $5,000 and receives another $5,000 from administration through their exclusive medical service providers. This is an example of a. Tying b. Bundling c. Exclusion d. Fraud, the company is not allowed to sell for any higher than the regulatory price