### Draw and briefly describe the conditions

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##### Reference no: EM131066739

A. Draw an isoquant curve and briefly describe what the curve represents. Label X2 input on the vertical axis and X1 on the horizontal axis.

B. Draw an isocost curve with a budget of \$4,000. The cost of input factor X1 is \$200 per unit and the cost of input factor X2 is \$400 per unit. Label X2 input on the vertical axis.

C. How would your isocost curve change (in Question B) if the budget shifted to \$2,000 and input costs remain constant? Label X2 input on the vertical axis.

D. Draw and briefly describe the conditions when the marginal rate of technical substitution (MRTS) equals the slope of the isocost curve. Label X2 input on the vertical axis.

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