isocost
An isocost line is a concept in microeconomics that represents all combinations of two inputs that cost the same total amount for a given set of input prices. If a firm uses labor L and capital K with wage rate w and rental rate r, respectively, the total cost is C = wL + rK. The isocost is the set of input bundles (L, K) that satisfy this equation for a fixed C. The line has a negative slope, equal to -w/r, and intercepts where either input is zero: when L = 0, K = C/r; when K = 0, L = C/w.
In production analysis, the isocost is used together with isoquants (curves of equal output) to determine the
Isocosts respond to changes in input prices and total cost. A rise in w or r rotates