Consider a firm's demand curve for labour.If a technological change makes it easier to substitute capital for labour,the demand curve for labour
A)shifts parallel to the right.
B)shifts parallel to the left.
C)becomes more inelastic.
D)becomes more elastic.
E)is not affected.

Question

Quizplus · Accepted Answer

Technological change that makes it easier to substitute capital for labour increases the elasticity of demand for labour, as firms can more easily replace labour with capital in response to wage changes.

Consider a Firm's Demand Curve for Labour