FIGURE 8- 4 -Refer to Figure 8- 4. the Firm Is Initially Minimizing

question 77

Multiple Choice

FIGURE 8- 4
-Refer to Figure 8- 4. The firm is initially minimizing the cost of producing 1000 units of output. Suppose the factor prices then change such that the price of capital (K) falls and the price of labour
(L) rises. If the firm decides to leave its output unchanged, it will now move toward the point

• A) A.
• B) B.
• C) C.
• D) D.
• E) unknown as there is insufficient information to know

---

Definitions:

Financial Position

A snapshot of what a company owns (assets) and owes (liabilities) at a particular point in time, showing its net worth.

Property

Assets or possessions owned by an individual or company, comprising both tangible items, like buildings and land, and intangible items like patents or copyrights.

Current Liability

A business's liabilities or amounts owed that must be settled with lenders within a twelve-month period.

Bonds Payable

Long-term liabilities represented by bonds that a company has issued, promising to repay the principal amount along with interest on specified dates.