Which of the following is FALSE?
A. A change in input prices shifts the isoquant map.
B. At the optimal input choice, the rate at which the firm can substitute labor for capital in production is equal to the rate at which the firm can substitute labor for capital in the market.
C. A change in cost shifts the isocost curve.
D. Convex isoquants mean that the marginal rate of technical substitution decreases as the firm substitutes labor for capital.
E. none of the above.
Answer: A
You might also like to view...
A price discriminating monopolist charges a very high price to the consumers with high price elasticity of demand
a. True b. False Indicate whether the statement is true or false
When a monopolist increases the amount of output that it produces and sells, the price of its output
a. stays the same. b. increases. c. decreases. d. may increase or decrease depending on the price elasticity of demand.