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In the long-run production function, all of the inputs to the production process are allow

In the long-run production function, all of the inputs to the production process are allowed to vary.

56) The fact that a firm is using a capital-intensive method of production means that input substitution is not possible.

57) A firm is more likely to use a labor-intensive method of production when the relative amount of available labor is greater than the available amount of capital.

58) A change in technology or the relative prices of the inputs used in a production process would cause a manager's choice of inputs to use in the production process to change as well.

59) All else constant, a decrease in the per unit price of labor would create an incentive for a firm manager to substitute labor for capital in the firm's production process.

60) Assuming capital and labor are substitutes, an improvement in technology that affects only the productivity of capital would cause a firm to employ more capital but leave the amount of labor employed unchanged.

61) Studies and recent experience suggest that there is considerable potential for substitution between doctors and nurses in the production of health care services.

62) Studies and experience suggest that labor and capital are highly complementary inputs to the production of pipe organs.

63) The fact that supermarkets, a land-intensive form of organization, have become the dominant form of grocery store in the United States suggests that there is little or no potential for input substitution in the grocery store business.

64) X-inefficiency refers to the situation in which firms with market power are operating in the upward-sloping segment of their long-run average cost curve.

Dec 07 2019 View more View Less

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