The Absolute Value of the Slope of the Isoquant Is

question 107

Multiple Choice

The absolute value of the slope of the isoquant is the:

• A) marginal rate of technical substitution.
• B) marginal product of capital.
• C) marginal rate of substitution.
• D) value marginal product of labor.

---

Definitions:

MC = MR

The principle that profit maximization occurs when a firm's marginal cost (MC) equals its marginal revenue (MR).

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs, representing the surplus revenue after accounting for all costs.

Economic Loss

A situation where total costs exceed total revenues, indicating that a firm is not covering its opportunity costs.

Accounting Profit

The calculated income of a business or company after subtracting all explicit costs from total revenues.