This image features an economic graph with production isoquants and isocost lines.**Graph Description:**- The graph plots the capital (K) on the vertical axis and labor (L) on the horizontal axis.- Three isoquants, labeled Q=100, Q=200, and Q=300, are shown. - These illustrate different levels of output where Q refers to the quantity produced.- Each isoquant is curved, reflecting various combinations of labor and capital that yield the same level of output.- Three isocost lines, labeled TC1, TC2, and TC3, represent total cost levels. - These lines are linear and show combinations of labor and capital that incur the same total cost.- Intersection points along these curves are marked with labeled points: a, b, c, d, and e.**Question:**12. Which of the following is true about point (c)?- (a) MPPL/PL > MPPK/PK- (b) MPPL/PL = MPPK/PK- (c) MPPL/PL < MPPK/PK- (d) none of the aboveWhere, MPPL = Marginal Product of Labor PL = Price of Labor MPPK = Marginal Product of Capital PK = Price of CapitalThis question asks you to analyze the relationship between the marginal rate of technical substitution (MRTS) at point (c) in terms of the marginal products and prices of labor and capital.

ISO-Quant: ISO-Quant shows different combinations of capital and labour such that each combination…

Answered: 25 20 K 15 10 5 O TC3 TC2 TC1 51 O 10…

25 20 K 15 10 5 O TC3 TC2 TC1 51 O 10 12. Which of the following is true about point (c)? O(a) MPPL/PL > MPPK/PK O (b) MPPL/PL = MPPK/PK O (c) MPPL/PL

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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