True or False, and explain why. 1. The substitution effect is larger when labor and capital are perfect complements. 2. If the scale effect dominates the substitution effect, the demand for capital decreases. 3. The industry-wide labor demand curve can be simply obtained by summing the labor demand curves of all individual firms.

True or False, and explain why. 1. The substitution effect is larger when labor and capital are perfect complements. 2. If the scale effect dominates the substitution effect, the demand for capital decreases. 3. The industry-wide labor demand curve can be simply obtained by summing the labor demand curves of all individual firms.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter26: Factor Markets: With Emphasis On The Labor Market

Section: Chapter Questions

Problem 12QP

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