Isocost Line
Definition
All combinations of inputs that cost the firm the same total. Slope = ratio of input prices.
Example
On a graph of labor and capital, an isocost line slopes downward with slope −w/r.
All combinations of inputs that cost the firm the same total. Slope = ratio of input prices.
On a graph of labor and capital, an isocost line slopes downward with slope −w/r.