Cost-Responsiveness Frontier Definition
The cost-responsiveness frontier is the set of all combinations of output levels and input prices that minimize the cost of producing a given level of output. It is represented by a curve on a graph with output on the horizontal axis and input prices on the vertical axis. The curve is downward-sloping, indicating that as output increases, input prices fall. The slope of the curve indicates the marginal rate of technical substitution (MRTS), which is the rate at which one input can be replaced by another while maintaining the same level of output.
