Question

Which of the following statements is (are) true? i. more output is produced at point a than at point b. ii. the ratio of the marginal product of labor to the marginal product of capital is higher at point a than at point b. iii. the mrtslk is equal at points a and b.

a. i, ii, and iii
b. iii
c. ii
d. None of the above.

Answer 1

The correct choice is d. None of the above. None of the statements provided can be confirmed to be true.

Step-by-step explanation:

The correct choice is d. None of the above.

Let's analyze each statement:

Statement i is not necessarily true. The output produced at point A may be higher, lower, or equal to the output produced at point B, depending on the specific circumstances of the scenario.

Statement ii is not necessarily true either. The ratio of the marginal product of labor to the marginal product of capital can be higher, lower, or equal at point A compared to point B, depending on the specific conditions of the production function.

For statement iii, it is not possible to determine whether the marginal rate of technical substitution (MRTS) of labor for capital is equal at points A and B without additional information. The MRTS depends on the specific production function and the substitution possibilities between labor and capital.

Therefore, none of the statements can definitively be deemed true, and the correct choice is d. None of the above.