Consider a Firm That Seeks to Minimize the Cost of Producing

question 18

Multiple Choice

Consider a firm that seeks to minimize the cost of producing a given level of output. Which of the following statements is true?

• A) In equilibrium, the rate of return on capital equals the wage rate.
• B) In equilibrium, the wage rate equals the slope of the isoquant.
• C) In equilibrium, the ratio of input prices equals the marginal rate of technical substitution.
• D) In equilibrium, it will produce on the inelastic portion of its long-run labour demand curve.
• E) In equilibrium, the rate of return on capital equals the slope of the isoquant.

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