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Using the isoquant-isocost curves, what will be the choice of a cost-minimizing firm suppose the wage rate increases but the firm wants to produce the
Using the isoquant-isocost curves, what will be the choice of a cost-minimizing firm suppose the wage rate increases but the firm wants to produce the same level of output? (show using graph)
a) Reduce the use of both K and L in production
b) Reduce the use of L, increase K
c) Reduce the use of K, increase L
d) The firm will be indifferent between the two: reducing L and increasing K, or reducing K and increasing L
e) Cannot be determined
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