11A.8  Draw an isoquant–isocost line graph to illustrate the following situation: Jill Johnson can rent pizza ovens for $200 per week and hire workers for $100 per week. Currently, she is using 5 ovens and 10 workers to produce 20,000 pizzas per week and has total costs of $2,000. Jill’s marginal rate of technical substitution (MRTS) equals −1. Explain why this means that she’s not minimizing costs and what she could do to minimize costs.

 

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Status NEW Posted 28 May 2017 09:05 AM My Price 6.00

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