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      Question

      If factor prices equal, slope of

      isoquant
      A 1 Correct Answer Incorrect Answer
      B -1 Correct Answer Incorrect Answer
      D 2 Correct Answer Incorrect Answer

      Solution

      This is because the slope of the isocost line is determined by the ratio of factor prices, and at equilibrium, the slopes of the isoquant and the isocost line are equal. When factor prices are equal, this ratio becomes -1, so the slope of the isoquant at that tangency point is also -1.Β 

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