When the Isocost Line Is Tangent to the Isoquant,then

question 85

Multiple Choice

When the isocost line is tangent to the isoquant,then

• A) MPL = MPK.
• B) the firm is producing that level of output at minimum cost.
• C) the firm has achieved the right economies of scale.
• D) All of the above.

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Definitions:

Tax

A compulsory financial charge imposed by a government on individuals, corporations, or other entities to fund government spending and public services.

Market Price

The current price at which a good or service can be bought or sold in a marketplace, determined by supply and demand.

Government Subsidy

Financial assistance provided by the government to support a specific industry, entity, or activity that is considered beneficial for the public.

Rental Rates

The cost associated with leasing or renting property, equipment, or other assets, usually expressed as a price per time period.