Multiple Choice
If the marginal product of labor is four times the marginal product of capital and the price of labor is twice the price of capital,then:
A) labor will be substituted for capital by a profit maximizing firm.
B) capital will be substituted for labor by a profit maximizing firm.
C) output cannot be expanded any further by using the same input levels.
D) input usage should be left unchanged.
Correct Answer:
Verified
Correct Answer:
Verified
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