A firm becomes more capital intensive if it increases the ratio of capital to labor.

Name: A firm becomes more capital intensive if it increases the ratio of capital to labor.
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Question

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When a firm increases the ratio of capital to labor, it means it is investing more in physical capital such as machines, equipment, and technology relative to the number of employees it has. This makes the firm more capital intensive, as it relies more on capital rather than labor to produce goods or services.

A Firm Becomes More Capital Intensive If It Increases the Ratio