Consider a Firm Using Three Inputs: Unskilled Labor,skilled Labor,and Capital

Multiple Choice

Consider a firm using three inputs: unskilled labor,skilled labor,and capital.Unskilled labor and capital are substitutes in production,while skilled labor and capital are complements in production.If the price of capital decreases,then

A) employment of skilled labor increases and employment of unskilled labor decreases.
B) employment of both skilled and unskilled labor decreases.
C) employment of skilled labor increases but the effect on employment of unskilled labor is ambiguous.
D) employment of skilled labor could increase or decrease and the employment of unskilled labor definitely decreases.