Author Question: In the classical model, and increase in tax on firms that hired labor would a. decrease labor ... (Read 105 times)

Jipu 123 · **on:** Jun 30, 2018

In the classical model, and increase in tax on firms that hired labor would

a. decrease labor demand and the real wage and increase output.
b. decrease labor supply, increase the real wage, and decrease output.
c. decrease labor demand, decrease the real wage, and decrease output.
d. reduce real wages and increase output.

Question 2

As the quantity of labor increases, the marginal product of capital

A) is constant.
B) increases.
C) decreases.
D) may either increase or decrease.