Solved

Suppose a Firm Uses Three Inputs in Production,capital,labor,and Land

Question 8

Multiple Choice

Suppose a firm uses three inputs in production,capital,labor,and land.If the price of labor increases,the firm adjusts by decreasing the amount of labor used,increasing the amount of capital used and decreasing the amount of land used.What does this imply about the relationship between the three inputs?


A) Land and labor are net substitutes while labor and capital are net complements.
B) Land and labor are net complements while labor and capital are net substitutes.
C) Land and labor are gross substitutes while labor and capital are gross complements.
D) Land and labor are gross complements while labor and capital are gross substitutes.
E) none of the above

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents