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Suppose Over Time That a Firm's Production Process Undergoes Capital-Saving MRTSL,KMR T S_{L ,K}

Question 59

Multiple Choice

Suppose over time that a firm's production process undergoes capital-saving technological progress. This implies


A) the isoquants corresponding to any particular level of output will shift outward from the origin and the MRTSL,KMR T S_{L ,K} =
along any ray from the origin will increase.
B) the isoquants corresponding to any particular level of output will shift outward from the origin and the MRTSL,KMR T S_{L ,K} =
along any ray from the origin will decrease.
C) the isoquants corresponding to any particular level of output will shift inward toward the origin and the MRTSL,KMR T S_{L ,K} =
along any ray from the origin will increase.
D) the isoquants corresponding to any particular level of output will shift inward toward the origin and the MRTSL,KMR T S_{L ,K} =
along any ray from the origin will decrease.

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