Illustrate and explain the concept of the least cost factor combination using isoquant curve and isocost line

Q: Explain the differences between diminishing marginal returns and diseconomies of scale.

A: Since the marginal return can be defined as the additional return by purchasing an additional…

Q: y= f(x1,x2)=x1ax2b Derive the equation for an isoquant curve.   If a=b=0.5 , the price of factor 1…

A: y= f(x1,x2)=x1ax2b a=b=0.5 the price of factor 1 is 12, the price of factor 2 is 3

Q: One isocost line can intercept an isoquant. Select one: O True O False

A: An isoquant refers to the locus of points showing all the technically efficient ways of combining…

Q: Explain two reasons due to which economies of scale may arise. Write your answer within 40 words.…

A: Economies of scale refer to the cost advantage of the firms when they increase production. Economies…

Q: Draw an isoquant-isocost diagram consistent with points A and B on the long-run average cost curve…

A:

Q: Long-Run Q 10 90 AC $

A: In the short run, some inputs are fixed and some are variable. Whereas in the long run, all the…

Q: Discuss the connection between returns to scale and diminishing marginal product. Provide graphs to…

A: Definitions In the short run, increasing input after reaching maximum capacity while keeping at…

Q: Draw the isoquant map for the technology q = √LK. Be precise.

A: Isoquant shows all the different combinations of the two inputs that can used in order to produce…

Q: How would the scale economies determine the shape of the long run Average cost curve(LAC) What are…

A: Economies of scale refers to a situation in which as the level of output for a firm increases, its…

Q: What is total fixed cost when output is 2, fixed cost is 25, and average cost is 30

A: Fixed cost are such cost that do not vary with the level of output i.e it remains constant at every…

Q: Define and graph total cost, average costs, and marginal cost.

A: The cost of producing/manufacturing all the units of a good by a firm is estimated by the total…

Q: According to following information, which of the following is the total cost function in the form of…

A: Total cost is the cost that includes total fixed cost as well as a total variable cost of the…

Q: Costant return toscale: Situation inwhich output doubles when E CONo MIESOF SCACE chen firm can…

A: An isocost line is a graph that depicts several input combinations that cost the same total amount…

Q: Show the relationship between production function and cost function

A: Production function refers to the quantities of a physical product to the quantity of factors of…

Q: Define Average unit cost,

A: There are different types of cost in production, total cost, average cost and marginal cost. Total…

Q: In the isoquant/isocost diagram (Figure 1), suppose the firm is producing 1,000 units of output at…

A: Cost minimization or output maximization is the point where the slope of the isoquant and iso-cost…

Q: Graph the following:  Average Total Cost curve and Average Variable Cost curve with proper…

A: Average total cost refers to per unit cost of production which is calculated by dividing total cost…

Q: Define economies of scale and explain why they mightarise

A: Economics of scale are the result of production efficiency. It can be a reason for a larges firms to…

Q: using an isoquant/isocost diagram explain the difference between diminishing returns to a variable…

A: Isocost lines are the contours of different budget constraints that show equal level of cost with…

Q: A firm’s isoquant map is depicted below. Which of the following statements are true?

A: An isoquant curve refers to the concave line plotted on a graph, showing all of the various…

Q: Fill in the appropriate numbers in the blank spaces, given the following information: output Total…

A: Fixed cost remains the same at each level of output. The variable cost keeps changing as output…

Q: Draw the isoquant map, be precise for at least one isoquant line, carefully determine the gaps…

A: A production function of a firm represents the relationship between the output and input factors…

Q: Which of the following statements about average and marginal cost is INCORRECT? (2) (1) The marginal…

A: MARGINAL COST CURVE: A graph that shows the relationship between a firm's marginal cost in the…

Q: Discuss the relationship between the average product curve and marginal product curve. Substantiate…

A: Average product refer to per unit output on the other marginal product refer to that product which…