If a Firm's Production Function Is Leontief and the Wage

question 126

Multiple Choice

If a firm's production function is Leontief and the wage rate goes up,the:

• A) firm must use more labor in order to minimize the cost of producing a given level of output.
• B) firm must use more capital in order to minimize the cost of producing a given level of output.
• C) firm must use less labor in order to minimize the cost of producing a given level of output.
• D) cost minimizing combination of capital and labor does not change.