Suppose labor and capital are the only two resources
Used for production.In the long run:
A)both capital and labor can move freely between sectors.
B)only labor can move between sectors.
C)only capital can move between sectors.
D)both capital and labor are blocked from moving between sectors.

Question

Quizplus · Accepted Answer

In the long run, both capital and labor can move freely between sectors as there may be changes in market conditions and technology creating demand for a different mix of labor and capital in different sectors. This movement of resources between sectors helps to allocate resources efficiently and maximize production.

Suppose Labor and Capital Are the Only Two Resources