Asked by
Aaliyah Francois
on Oct 25, 2024Verified
Two isoquants, which represent different output levels but are derived from the same production function, cannot cross because:
A) isoquants represent different utility levels.
B) this would violate a technical efficiency condition.
C) isoquants are downward sloping.
D) additional inputs will not be used by profit maximizing firms if those inputs decrease output.
E) Both B and D are true.
Isoquants
Curves that represent combinations of various input factors that produce the same output level.
Production Function
A mathematical relationship that describes how inputs like labor and capital are converted into outputs, representing the maximum output possible from a given set of inputs.
Technical Efficiency
The ability of a firm to get the maximum output from a given set of inputs, minimizing waste.
- Analyze conditions under which isoquants can or cannot cross and the implications for production efficiency.
Verified Answer
HW
Learning Objectives
- Analyze conditions under which isoquants can or cannot cross and the implications for production efficiency.