Asked by Faustine Hudson on Jul 06, 2024
Verified
Refer to Figure 7.10. At Point C, the slope of q2 = 200 is
A) -2.
B) -1/2.
C) -1.
D) indeterminate from this information.
Slope
In mathematics, it is the measure of the steepness or inclination of a line, often calculated as the ratio of the vertical change to the horizontal change between two points on the line.
Isoquant
A curve that represents all the combinations of inputs that produce the same level of output in production theory.
Indeterminate
A state or outcome that cannot be predicted or decisively determined due to insufficient information.
- Differentiate between the gradients of various isocost lines and their importance.
- Gain insight into how isocost lines and isoquants work together to optimize production outcomes.
Verified Answer
BA
Brogan AnderssonJul 08, 2024
Final Answer :
B
Explanation :
The slope of a line in economics, especially in the context of supply and demand curves, is calculated as the change in price over the change in quantity. Given the slope is 200, and assuming linear relationships, a slope of -1/2 indicates that for every unit increase in quantity, the price decreases by half a unit, which is consistent with a negative slope indicating an inverse relationship between quantity and price.
Learning Objectives
- Differentiate between the gradients of various isocost lines and their importance.
- Gain insight into how isocost lines and isoquants work together to optimize production outcomes.