Why are isocost lines straight lines

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Suppose a chair manufacturer finds that the marginal rate of technical substitution of capital for labor in his production process is substantially greater than the ratio of the rental rate on machinery to the wage rate for assembly-line labor. How should he alter his use of capital and labor to minimize the cost of production?
Why are isocost lines straight lines?
Assume the marginal cost of production is increasing. Can you determine whether the average variable cost is increasing or decreasing? Explain.
Assume the marginal cost of production is greater than the average variable cost. Can you determine whether the average variable cost is increasing or decreasing? Explain.
If the firm's average cost curves are U-shaped, why does its average variable cost curve achieve its minimum at a lower level of output than the average total cost curve?

Reference no: EM13692805

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