Question 11

An isoquant:

a. summarizes the input combinations for which the total cost is unchanged.

b. illustrates constant returns to scale.

c. summarizes the input combinations that yield the same level of output.

d. summarizes the cost minimizing combinations of inputs.

e. None of the above.

Question 12

L-shaped isoquants indicate that:

a. inputs are perfect substitutes.

b. inputs are employed in fixed proportions.

c. inputs are imperfect substitutes.

d. the prices of inputs are unchanged.

e. None of the above.

Question 15

The marginal rate of technical substitution:

a. determines the rate at which a producer can substitute between two inputs in order to increase output by one additional unit.

b. is the slope of the isoquant.

c. is the absolute value of marginal revenue.

d. is constant along the isoquant curve.

e. None of the above.

Question 16

If output triples when all inputs are doubled, the firm’s production function exhibits:

a. increasing returns to scale.

b. decreasing returns to scale.

c. constant returns to scale.

d. increasing marginal product.

e. None of the above.

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