The output effect of a change in the wage rate on a firm's demand for labor input will be greater
a. the larger the share of labor costs in total costs and the greater the price elasticity of demand for output.
b. the larger the share of labor costs in total costs and the smaller the price elasticity of demand for output.
c. the larger the share of labor costs in total costs and the higher the quantity demanded.
d. the smaller the possibilities of substituting capital for labor.
a
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In the Keynesian model, money is
A) neutral in both the short run and the long run. B) neutral in neither the short run nor the long run. C) neutral in the short run, but not in the long run. D) neutral in the long run, but not in the short run.
Economists measure the "openness" of an economy in terms of
A) its immigration policies. B) how often it holds free elections. C) the percentage of foreign-born workers in its labor force. D) how much it trades with other economies.
Refer to the above diagram showing the average total cost curve for a perfectly competitive firm. Suppose that average variable cost is $8 at 40 units of output. At that level of output, total fixed cost:
A. is $2.
B. is $40.
C. is $80.
D. cannot be determined from the information provided.
We know government failure as the notion that ________ becomes the tool of ________ and makes the allocation of resources even less efficient than before, and this is described in public choice theory.
A. the public; the government B. government; the rent seeker C. a natural monopoly; the government D. government; barriers to entry