SOLUTION: in production analysis, an isocost line is a line whose points represent all combinations of two factors of production that can be purchased for the same amount. suppose a farmer h
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Question 186630This question is from textbook mathematical analysis
: in production analysis, an isocost line is a line whose points represent all combinations of two factors of production that can be purchased for the same amount. suppose a farmer has allocated $20,000 for the purchase of x tons of fertilizer (costing $200 per ton) and y acres of land (costing $2000 per acre). find an equation of the isocost line that describes the various combinations that can be purchased for $20,000. observe that neither x nor y can be negative.
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Thank you :) This question is from textbook mathematical analysis
You can put this solution on YOUR website! Let x be tons of fertilizer. Let y be acres of land.
Cost of Fertilizer is given by 200x.
Cost of Land is given by 2000y
The total cost is given by
That equation is a line
The portion of the line that is 'a real answer' in this case, requires that both fertilizer and land be positive values. So use that part of the curve bounded by
x>=0 and x<=10.
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