The Marginal Rate of Technical Substitution Is

question 45

Multiple Choice

The marginal rate of technical substitution is

• A)the rate at which the firm can substitute labor for capital while holding total cost constant.
• B)the rate at which the firm can substitute labor for capital while holding output constant.
• C)the slope of the isocost curve.
• D)both a and c
• E)none of the above

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Definitions:

Semi-Annual

Semi-Annual refers to something occurring or done twice a year, typically every six months.

Coupon Bond

A bond that pays the holder a fixed interest payment (coupon) at regular intervals until the maturity date, when the principal and final interest payment are repaid.

Yield To Maturity

The total return anticipated on a bond if the bond is held until its maturity date, taking into account its current market price, face value, interest rate, and time to maturity.

Par Value

Is the face value of a bond or stock, representing the amount that will be returned to the investor at maturity or the value at which the stock is noted on the balance sheet.