If an Isocost Line Cuts Through the Isoquant Line, a Cost

question 47

Multiple Choice

If an Isocost line cuts through the Isoquant line, a cost minimizing firm will:

• A) Choose the factor input combination at the intersection on the higher point of the Isoquant.
• B) Choose the factor input combination at the intersection on the lower point of the Isoquant. Use the input bundle associated with the intersection on the lower point of the Isoquant.
• C) Choose any combination of the factors between where the Isocost line cuts through the isoquant line.
• D) Use a lower Isocost line to select the combination of inputs.

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