When labor is relatively expensive, as it is in Japan,
A)manufacturers will employ lots of labor
B)the unemployment rate will be high
C)vending machines displace labor, causing unemployment
D)businesses will substitute capital -- such as vending machines -- in place of labor
E)alcohol and cigarettes must be sold through vending machines

Question

Quizplus · Accepted Answer

When labor is relatively expensive, businesses will look for ways to minimize labor costs. One way to do this is by substituting capital, such as vending machines, in place of labor. This allows businesses to automate certain processes and reduce the amount of labor required to produce or sell goods, which in turn reduces labor costs. This is a common strategy in countries where labor is expensive, such as Japan.

When Labor Is Relatively Expensive, as It Is in Japan