In which of the following cases would you expect to observe the highest level of desired capital stock?
A) the rental cost of capital is high and wage rates are low
B) the rental cost of capital is low and the level of output is high
C) the rental cost of capital is low and the level of output is low
D) the level of output is low and wage rates are high
E) the level of output is low and wage rates are low
Correct Answer:
Verified
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