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Suppose the Payments to Capital and Labor Are (W*L*)/Y* = ×\times

Question 44

Multiple Choice

Suppose the payments to capital and labor are (w*L*) /Y* = 2/3 and (r*L*) /Y* = 1/3,respectively.One implication of this result is:


A) (w*L*/r*K*) = Y*.
B) w*L* - r*K* = Y*.
C) w*L* ×\times r*K* = Y*.
D) w*L* + r*K* = Y*.
E) (w*L*/Y*) (r*K*/Y*) = 0.

Correct Answer:

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