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diamong [38]
3 years ago
8

Given labor is on the horizontal axis and capital is on the vertical​ axis, as the price of labor​ increases, the isocost line b

ecomes flatter . If both the price of labor and capital rise in the same​ proportion, which of the following will occur​ (holding production costs​ constant)? A. The isocost line becomes flatter. B. The isocost line makes a parallel shift inward. C. The isoquant makes a parallel shift outward. D. The isocost line shifts outward. E. The isocost line becomes steeper.
Business
1 answer:
lions [1.4K]3 years ago
3 0

Answer:

B The isocost line makes a parallel shift inward

Explanation:

This is because the increase in price is proportional ,less of labor and capital can be bought,and isocost line shifts inward parallely.

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