Figure 6.9 When Capital Becomes More Expensive, the Isocost Line Becomes Flatter
When the price of capital increases from R = $20 to R = $40 and the price of labor stays constant at W = $10, the slope of the isocost changes from 
to 
. The quantity of inputs the firm can buy for $100 decreases and the isocost line becomes flatter.
to . The quantity of inputs the firm can buy for $100 decreases and the isocost line becomes flatter.