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    Price Theory and Applications
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    Exam 15: The Demand for Factors of Production
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    When Will the Scale Effect of a Wage Increase Cause
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When Will the Scale Effect of a Wage Increase Cause

Question 24

Question 24

Multiple Choice

When will the scale effect of a wage increase cause a fall in the amount of labor employed?


A) Always.
B) When labor is not a regressive factor.
C) When labor and capital are substitutes in production.
D) When labor and capital are complements in production.

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