Given an 8 percent increase in wages, firm A cuts back on labor more than firm B. It follows that, ceteris paribus,
A) there are likely fewer substitutes for labor in firm B than firm A.
B) there are likely fewer substitutes for labor in firm A than firm B.
C) sunk costs are greater for firm A than firm B.
D) the demand for the product that firm A produces is likely less elastic than the product that firm B produces.
E) a and d
Correct Answer:
Verified
Q136: A profit maximizing firm that is a
Q137: Exhibit 26-7 Q138: Exhibit 26-7 Q139: For a given firm, marginal factor cost Q140: The MPP of labor divided by its Q142: When deciding whether a person is "worth" Q143: Given a 10 percent increase in wages, Q144: Marginal productivity theory states that Q145: Which of the following can change the Q146: The elasticity of demand for labor is
A)firms in price
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents