The Point of Tangency Between an Isoquant and the Isocost

question 17

Multiple Choice

The point of tangency between an isoquant and the isocost line indicates:

• A)that in the long run fixed costs are equal to variable costs.
• B)the maximum cost incurred for producing one unit of output.
• C)that in the long run marginal costs tend to exceed fixed costs.
• D)the minimum cost necessary to produce a particular level of output.