All else the same, if a ﬁrm revises its production process to use more labour and less machinery, the
ﬁrm will have an increased capital intensity.

Name: All else the same, if a ﬁrm revises its production process to use more labour and less machinery, the ﬁrm will have an increased capital intensity.
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Question

Quizplus · Accepted Answer

Increasing the use of labor and decreasing the use of machinery would result in decreased capital intensity, as capital intensity is defined as the ratio of capital (machinery) to labor.

All Else the Same, If a ﬁRm Revises Its Production