Suppose the substitution elasticity between capital and labor is -2.6%.What does this imply about the demand for labor?
A) The long run demand for labor is relatively inelastic.
B) The long run demand for labor is relatively elastic.
C) The short run demand for labor is relatively inelastic.
D) The long run supply of labor is relatively inelastic.
E) The long run supply of labor is relatively elastic.
Correct Answer:
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