Consider a Firm's Demand Curve for Labour

question 39

Multiple Choice

Consider a firm's demand curve for labour.If a technological change makes it easier to substitute capital for labour,the demand curve for labour

• A)shifts parallel to the right.
• B)shifts parallel to the left.
• C)becomes more inelastic.
• D)becomes more elastic.
• E)is not affected.

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Definitions:

Consumers

Individuals or entities that purchase goods and services for personal use or consumption.

External Costs

Costs incurred as a result of an economic activity that affects third parties who did not choose to incur that cost.

Free Enterprise

An economic system where private businesses operate in competition, largely free of state control, with the prices of goods and services determined by the open market.

Capital

Financial assets or the financial value of assets, such as buildings, machinery, and equipment, used to produce goods and services.