Labor demand curves are homogeneous of degree zero.
Answer the following statement true (T) or false (F)
True
Rationale:
If a labor demand curve 
is homogeneous of degree zero, it means that 
In other words, if wages and prices increase by the same proportion, labor demand remains unchanged. The slope of isoprofits is (w/p) -- so the slope does not change as both w and p increase by the same proportion -- which means the profit maximizing production plan has not changed.
is homogeneous of degree zero, it means that In other words, if wages and prices increase by the same proportion, labor demand remains unchanged. The slope of isoprofits is (w/p) -- so the slope does not change as both w and p increase by the same proportion -- which means the profit maximizing production plan has not changed.
Economics
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The results of a 2008 Los Angeles Times poll suggest that a significant majority of Americans believe that free international trade helps the American economy
a. True b. False Indicate whether the statement is true or false
Economics
Suppose a firm uses both labor (L) and capital (K) and its long-run production function is given by the expression Q = F(L,K) = L2 × ?(L + 2K). The firm currently uses 100 units of capital. Assuming labor is finely divisible, graph the firm's short-run production function for the first five workers.
What will be an ideal response?
Economics