a) What is an iso-cost line in production economics? (2 marks) b) A farmer has sh.10,000...

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a) What is an iso-cost line in production economics? (2 marks) b) A farmer has sh.10,000 available for the purchase of two inputs x and x. Input x costs sh.500 and input costs sh.300 per unit. Given that values of x, range between 0 and 20, present in a table six possible combinations of x and that could be purchased with the sh.10,000 (6 marks) c) Using the example in b, show that the slope of an iso-cost line is equal to the inverse input price ratio. (4 marks) d) How can one determine the least cost combination of inputs x and x2? (2 marks) a) What is an iso-cost line in production economics? (2 marks) b) A farmer has sh.10,000 available for the purchase of two inputs x and x. Input x costs sh.500 and input costs sh.300 per unit. Given that values of x, range between 0 and 20, present in a table six possible combinations of x and that could be purchased with the sh.10,000 (6 marks) c) Using the example in b, show that the slope of an iso-cost line is equal to the inverse input price ratio. (4 marks) d) How can one determine the least cost combination of inputs x and x2? (2 marks)

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a In production economics an isocost line represents all the combinations of inputs that can be purc... View the full answer