Labor demand is more elastic the greater the elasticity of substitution between labor and capital because
A) workers supply more labor when their wage increases.
B) the firm's output price falls when the firm produces more output.
C) a firm is less willing to pay higher labor costs if it is easy for the firm to substitute capital for labor.
D) firms always have the option of substituting capital for labor.
E) a firm's technology is slow to change.
Correct Answer:
Verified
Q1: The elasticity of substitution is the
A) change
Q3: The production function relates
A) factor prices to
Q4: What is the most accurate description of
Q5: Labor demand is more elastic
A) the greater
Q6: The marginal rate of technical substitution at
Q7: Ally owns a shoe store. The market
Q8: At a wage of $25 per hour,
Q9: What is an example of the substitution
Q10: Why is the short run labor demand
Q11: At what point should a firm stop
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