Input substitution when the input price change, Microeconomics

Input Substitution When the Input Price Change

 Isoquants and Isocosts and Production Function

2278_production function.png

1616_input substitution.png

The minimum cost combination can be written as:

1726_input substitution1.png
- Minimum cost for a given output will occur when each dollar of input added to the production process will add an equivalent amount of output.

* Question

- If w = $10, r = $2, and MPL = MPK, which input would producer use more of?  Why? 

Posted Date: 10/12/2012 3:00:57 AM | Location : United States







Related Discussions:- Input substitution when the input price change, Assignment Help, Ask Question on Input substitution when the input price change, Get Answer, Expert's Help, Input substitution when the input price change Discussions

Write discussion on Input substitution when the input price change
Your posts are moderated
Related Questions
Infrastructure : Infrastructure plays an important role in the development of an economy. The adequacy or lack of it determines an economy's success or failure in increasing p

explain consumer equilibrium diagrammatically as well mathematically by using necessary and sufficient conditions

Withdrawing MRTP Restrictions: The restriction on the scrutiny of an investment proposal that it does not violate the provisions of MRTP Act was withdrawn. This freed big bus

which is more dense-Rubidium or Rubidium Hydride?

when does a buisness reach shutdown point

Explain the meaning of the statment "coffee and tea are close substitutes".

??????? ??? ???? ??? # 100 ?????? #Minimum ?????? ?????

The distinction between supply and the quantity supplied is best made by saying that

1). Define and explain the concept of an externality. Provide examples of both positive and a negative externality. 2). The Prisoner's Dilemma Exercise:

What are the Policies and Long-Run Growth In many concerns it is decidedly odd that world distribution of output per worker is as unequal as it is. Migration, World trade and f