Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. Explain about isocost line?
In economics, an isocost line signifies all combinations of inputs that cost the same total amount. Though, similar to the budget constraint in consumer theory, use of the isocost line pertains to cost-minimisation in production as opposed to utility-maximisation. For the two production inputs, capital and labour, with fixed unit costs of the inputs, equation of the isocost line is
rK + wL = C
Where w signifies the wage rate of labour, r represents interest rate of capital,
K is the units or amount of capital used, L is the amount of labour used whereas C is the total costof obtaining these inputs.
Absolute value of the slope of the isocost line, with labour plotted horizontally and capital plotted vertically, equals the ratio of the prices of inputs of capital and labour. The isocost line is combined with isoquant map to determine the optimal production. This optimality is arrived at a point where an isoquant and isocost curves are tangent to each other. It makes sure that firm attains the highest level of possible output with a given isocost line. Therefore the output is produced at with least cost or most efficiently. This tangency may also be interpreted as one where slopes of the isoquant and the isocost are equal. This entails that tangency ensures that marginal productivities of the two inputs are proportional to the ratios of prices of the two inputs.
Total Cost (TC) This is the sum of fixed costs and variable costs i.e. TC = FC + VC.
The gap between theory and practise and the role of managerial economics: We have noted above that application of theories to the process of business decision making contributes a
WHY MANAGERS NEED TO KNOW ECONOMICS The influence of economics towards the performance of managerial duties and responsibilities is of major importance. The importance and cont
CAPITAL ACCOUNT This records all transactions arising from capital movements into and out of the country. There are a variety of such capital flows recorded, namely: i.
Measurement of Inflation The rate of inflation is measured using the Retail Price Index. A retail Price Index aims to measure the change in the average price of a basket of g
Using the discounting principle calculate the present value of an annuity of five years at Rs. 500 payments made at the end of each of the next five years at 10% interest. stion..
Transfer Payments Are any payments made to households by the government that are not made in return for the services of factors of production i.e. there is no Quid pro Quo. S
100 schools are given exactly one million dollars each in grant money. They can spend the money on any or all of three programs: math tutoring (math), kickball lessons (kickball),
Consider a model world which is subject to a risk of global climate change. The damage is known to be from greenhouse gas (GHG) emissions as indicated by the marginal damage curve
Ozark Bottled Water Products Inc
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd