In equilibrium, other things being equal, all of the following changes will increase the real rental price of capital except:
A)a lower quantity of labour employed.
B)a lower stock of capital.
C)better technology.
D)a higher labour-capital ratio.

Question

Quizplus · Accepted Answer

A lower quantity of labour employed would decrease the demand for capital, leading to a decrease in the real rental price of capital, as capital and labor are often complementary inputs in production.

In Equilibrium, Other Things Being Equal, All of the Following