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A jeweler can potentially use two inputs in her handcrafted jewelry: copper or bronze. She finds that when she minimizes her costs (i.e. she is optimizing), she uses either copper or bronze, but never both. If these are her two inputs, what must her isoquants look like?

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Answer:

The isoquants will be straight parallel lines.

Explanation:

In the given secanrio copper or bronze may be used to produce jewellery. The utility derived from use of either one is the same. They are perfectly interchangeable. Therefore copper and bronze are perfect substitutes.

The isoquant curve shows all combinations of input that can be used to produce units of output.

For goods that have perfect substitution the isoquants are straight lines that are parallel to each other. The marginal rate of technical substitution is 1, and isoquant have slope angle of 45° with each axis.

Find attached an illustration of this. So copper is a perfect substitute for bronze.

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