Labor demand is more elastic the greater the elasticity of substitution between labor and capital because
A. a firm's technology is slow to change.
B. firms always have the option of substituting capital for labor.
C. the firm's output price falls when the firm produces more output.
D. a firm is less willing to pay higher labor costs if it is easy for the firm to substitute capital for labor.
E. workers supply more labor when their wage increases.
Answer: D
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