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

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 that __________ and profits are __________.

A) w*L* + r*K* = Y*;positive
B) w*L* + r*K* = Y*;equal to zero
C) w*L* + r*K* = Y*;negative
D) (w*L* - r*K*) = Y*;equal to zero
E) (w*L*/Y*) (r*K*/Y*) = 0;negative