If the marginal rate of technical substitution of labor for capital is 6, the price of labor is $18, and the price of capital is $9, then the firm
A. can substitute one unit of capital for six units of labor and keep output unchanged.
B. should use more capital and less labor.
C. should use more labor and less capital.
D. both a and b
E. both a and c
Answer: C
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What is public choice theory?
What will be an ideal response?
Firms in monopolistic competition compete by selling similar, but not identical products
Indicate whether the statement is true or false
An increase in the amount of competition with other firms that employ "best practices" would be likely to cause a particular firm's labor productivity to:
A) increase B) stay the same. C) decrease. D) cannot be determined without additional information.
The highest marginal tax rate for the federal income tax in the United States is
a. 10 percent b. 28.3 percent c. 35 percent d. 45.4 percent e. 50 percent