An increase in the price of capital willdemand for labor if capital and labor are substitutes, and it willthe demand for labor if the scale effect dominates.increase; decreasedecrease; increaseincrease; increasedecrease; decrease

In the production process, labor and capital are two basic inputs to generate output. Some products…

An increase in the price of capital will the demand for labor if the scale effect dominates. demand for labor if capital and labor are substitutes, and it will O increase; decrease decrease; increase increase; increase O decrease; decrease

An increase in the price of capital will the demand for labor if the scale effect dominates. demand for labor if capital and labor are substitutes, and it will O increase; decrease decrease; increase increase; increase O decrease; decrease

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Labor Force Participation Rate analysis

The labor force participation rate analysis calculates the percentage of the working-age population either employed or actively seeking work. It can be anyone in the age category of 16 to 64, on the condition that they are not institutionalized. A high labor force participation rate shows that more people are employed and contributing their wages to the economy, making it a healthy economy. It also shows that there are more people actively looking for employment leading to more hiring options for employers. On the other hand, a low labor force participation rate shows a low number of people employed or looking for work. This leads to an economic setback with fewer wages going into the economy. In such a scenario, employers might have to cut back on profits, lay off employees, or stop the process of hiring.

Question

An increase in the price of capital will
demand for labor if capital and labor are substitutes, and it will
the demand for labor if the scale effect dominates.
increase; decrease
decrease; increase
increase; increase
decrease; decrease

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