Question

In: Economics

Explanation of how a firm makes cost minimizing production decisions and how its cost varies with...

Explanation of how a firm makes cost minimizing production decisions and how its cost varies with output is known as

Iso-cost

iso-quant

theory of the firm

production function

Which one of the above is the answer?

Solutions

Expert Solution

Option C.

  • The theory of the firm explains how various firm's exist in market and how they behave in different marketing conditions.
  • It deals with how a firm makes cost minimization and profit maximization decisions.
  • It also shows how firms decide on optimising their costs which varies with each additional unit of an output produced.

Rahul Sunny answered 2 years ago
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