The correct answer is A. horizontal.
A factor price curve or the producer’s budget curve is a curve that shows the combinations of two inputs that a producer can purchase with a given budget. If one of the inputs, say L, is available free of cost to a producer, then the producer can purchase any amount of L without affecting his budget. This means that the producer’s budget curve will be a horizontal line, as he can purchase any amount of L without having to spend any money on it.
Option B is incorrect because an exponential curve is a curve that increases or decreases at an increasing rate. This is not the case for the producer’s budget curve, which is a straight line.
Option C is incorrect because a rectangular hyperbolic curve is a curve that decreases at an increasing rate. This is not the case for the producer’s budget curve, which is a straight line.
Option D is incorrect because an L-shaped curve is a curve that has a vertical segment and a horizontal segment. This is not the case for the producer’s budget curve, which is a straight line.