The slope of an isoquant gives the rate at which the firm must substitute capital for labor in order to maintain a constant level of output. This rate is usually known as the Marginal Technical Rate of Substitution (MRTS) or Technical Rate of Substitution (TRS).

    The isoquant gets flatter as we move down and to the right because the rate of substitution changes as factor proportions change. If there are already a lot of workers sharing a small amount of equipment, additional workers won't add much to output. If the firm wishes to use more workers and less equipment beyone point C it will need to hire more and more workers to substitute for each unit of capital given up. This is sometimes called a diminishing rate of technical substitution.

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