Suppose the Supply of Capital Is Relatively Inelastic

question 31

Multiple Choice

Suppose the supply of capital is relatively inelastic.If capital and labor are gross complements,the labor demand elasticity will be ,but if capital and labor are gross substitutes,the labor demand elasticity will be .

• A) high,high
• B) low,low
• C) low,high
• D) high,low
• E) zero,zero

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Definitions:

Fair Value Option

An accounting choice to measure certain financial assets and liabilities at fair market values.

Receivables Growth

An increase in the amount of money owed to a company by its customers for products or services that have been delivered or used but not yet paid for.

Fair Value Option

An accounting choice that allows companies to record certain financial assets and liabilities at their fair value, helping to provide a more accurate assessment of a company's financial situation.

Note Receivable

A written promise that one party will pay another party a definite sum of money on demand or at a specified future date.