Assume a Cobb-Douglas production function which exhibits constant returns to scale. If a natural disaster destroys some of the capital stock, the neoclassical theory of distribution predicts that the real wage will and the real rental price of capital will a. increase; decrease decrease; decrease O b. O c. increase; increase O d. decrease; increase

Assume a Cobb-Douglas production function which exhibits constant returns to scale. If a natural disaster destroys some of the capital stock, the neoclassical theory of distribution predicts that the real wage will and the real rental price of capital will a. increase; decrease decrease; decrease O b. O c. increase; increase O d. decrease; increase

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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