Multiple Choice
If Industry A can substitute capital for labor easily and Industry B cannot,then (other things equal)
A) Industry A's own-wage elasticity of demand will be higher than Industry B's.
B) Industry B's own-wage elasticity of demand will be higher than Industry A's.
C) the industries' own-wage elasticities of demand will be equal.
D) we cannot predict which firm's own-wage elasticity of demand will be higher.
Correct Answer:
Verified
Correct Answer:
Verified
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