If isoquants are plotted on a graph with capital measured on the vertical axis and labor on the horizontal axis, then an increase in the wage rate will cause the isocost line

to become steeper and the optimal quantity of labor will decrease

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to become steeper and the optimal quantity of labor will increase

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to become flatter and the optimal quantity of labor will decrease

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to become flatter and the optimal quantity of labor will increase

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Solution

The correct option is A
to become steeper and the optimal quantity of labor will decrease

If isoquants are plotted on a graph with capital measured on the vertical axis and labor on the horizontal axis, then an increase in the wage rate will cause the isocost line to become steeper and the optimal quantity of labor will decrease.

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Similar questions

(a)	Plot the data points.
(b)	Connect the data points with straight lines.
(c)	Use a kink if actual data is far away from the starting value zero.
(d)	Determine the independent and dependent variables.
(e)	Choose the horizontal and vertical axis scale depending upon the minimum and maximum value of the independent and dependent variables, respectively.
(f)	Set the independent variable on the horizontal axis and the dependent variable on the vertical axis with appropriate units.

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