The Output Effect of a Change in the Wage Rate

Multiple Choice

The output effect of a change in the wage rate on a firm's demand for labor input will be greater

A) the larger the share of labor costs in total costs and the greater the price elasticity of demand for output.
B) the larger the share of labor costs in total costs and the smaller the price elasticity of demand for output.
C) the larger the share of labor costs in total costs and the higher the quantity demanded.
D) the smaller the possibilities of substituting capital for labor.