If a Firm Is Producing at Minimum Cost Using Positive

question 39

Multiple Choice

If a firm is producing at minimum cost using positive amounts of two inputs, an increase in the price of input one will cause

• A)a decrease in the marginal rate of technical substitution
• B)an increase in the marginal product of input one
• C)a decrease in the absolute value of the slope of the isocost
• D)a decrease in the marginal product of input one

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Definitions:

Owner's Equity Accounts

Accounts reflecting the owner's investment in the business plus any profits retained in the business, minus any withdrawals made.

Investment in Stock

The purchase of shares in a company to gain partial ownership and potentially earn dividends or capital gains.

Capital Stock

The amount of money or assets that owners have contributed to a corporation in exchange for shares of ownership.

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board that guide the preparation and presentation of financial statements globally.