In Comparing Two Otherwise Identical Industries X and Y,an Economist

question 60

Multiple Choice

In comparing two otherwise identical industries X and Y,an economist finds that labor demand is less elastic in industry X.Which of the following would support this finding?

• A)Capital and labor are less easily substituted for one another in X than in Y
• B)Labor costs as a percentage of total costs are relatively higher in X than in Y
• C)Product demand elasticity is higher in X than in Y
• D)Substitute resources have a more elastic supply in X than in Y

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Definitions:

Bound

Confined, secured, or held within certain limits or under a specific constraint.

Clotting Process

The series of steps that the body undertakes to stop bleeding, involving the aggregation of platelets and the formation of fibrin strands that trap blood cells.

Fibrin

Threadlike protein that is formed from the soluble plasma protein fibrinogen during blood clotting.

Mesh

A material made from interconnected strands that forms a barrier or a net-like structure.