Suppose That, for Country X, the Labour Cost Per Hour

question 87

Multiple Choice

Suppose that, for country X, the labour cost per hour has remained the same while unit labour costs have increased over the past five years. Which of the following can be correctly inferred from this information?

• A) Country X has a cost advantage compared to other countries.
• B) Wages in country X are likely to have been increasing in the past 5 years.
• C) Most of the firms in country X are operating at constant returns to scale.
• D) The quantity of output produced per hour has been falling in the past 5 years.

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