The advantage of substituting capital for labor in a production is it reduces average variable costs and can be quickly reduced when demand falls.

Name: The advantage of substituting capital for labor in a production is it reduces average variable costs and can be quickly reduced when demand falls.
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Substituting capital for labor often involves high fixed costs and cannot be quickly adjusted when demand falls, unlike labor which can be more flexible.

The Advantage of Substituting Capital for Labor in a Production