If an economic shock decreases labor demand, equilibrium employment If wages are flexible, the decrease in employment and real GDP will be When workers are laid off, what happens to physical capital? and real GDP the decrease if wages are rigid. OA. Physical capital becomes more productive, leading firms to increase capacity utilization. OB. Capacity utilization does not change. OC. Physical capital becomes less productive, leading firms to reduce capacity utilization. D. Laborers become more productive, leading firms to increase capacity utilization.

If an economic shock decreases labor demand, equilibrium employment If wages are flexible, the decrease in employment and real GDP will be When workers are laid off, what happens to physical capital? and real GDP the decrease if wages are rigid. OA. Physical capital becomes more productive, leading firms to increase capacity utilization. OB. Capacity utilization does not change. OC. Physical capital becomes less productive, leading firms to reduce capacity utilization. D. Laborers become more productive, leading firms to increase capacity utilization.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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