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If Labor Costs Twice as Much as Capital (Per Unit)

Question 34

Multiple Choice

If labor costs twice as much as capital (per unit) , then, in the long run,


A) labor will be twice as productive on average as capital.
B) labor's marginal product will be twice that of capital's.
C) the firm will hire twice as much labor as capital.
D) the firm will hire less labor and more capital.

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