When the Price of All Inputs Increase by the Same

question 40

Multiple Choice

When the price of all inputs increase by the same percentage:

• A)the firm's total cost curve will rotate upward by a higher percentage if the firm's production technology exhibits decreasing returns to scale.
• B)the firm's total cost curve will rotate upward by the same percentage.
• C)the firm's total cost curve will rotate upward by a higher percentage if the firm's production technology exhibits increasing returns to scale.
• D)the firm's total cost curve will remain unchanged since the cost-minimizing combination of inputs is unchanged.