In general, does the demand for labor become more or less elastic as we increase the number of other variable inputs used in a production process?
A) More elastic
B) No change in elasticity
C) Less elastic
D) We cannot answer this question without more information about the other inputs.

Question

Quizplus · Accepted Answer

The demand for labor becomes more elastic as we increase the number of other variable inputs used in a production process because firms have more flexibility to substitute between labor and other inputs, making it easier to adjust labor usage in response to wage changes.

In General, Does the Demand for Labor Become More or Less