If Producer Choice Sets Are Convex and a Production Plan

question 4

True/False

If producer choice sets are convex and a production plan satisfies the condition that the (marginal) technical rate of substitution is equal (in absolute value) to the ratio of input prices, then the production plan is profit maximizing.

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Definitions:

Silica

A chemical compound of silicon and oxygen, often found in quartz and used in glass making and electronics.

Halite

Halite is a naturally occurring mineral known as rock salt, consisting mainly of sodium chloride (NaCl), and is often mined for use in cooking and as a road deicer.

Water

A transparent, tasteless, odorless, and nearly colorless chemical substance, which is the main constituent of Earth's streams, lakes, and oceans, and the fluids of most living organisms.

Carbonate

A salt of carbonic acid, characterized by the presence of the carbonate ion, CO3^2-, or a compound containing this ion.