A-LevelEconomicsThe price system and the microeconomy9708/12 · Oct/Nov 2024 · Q71 Mark
A firm produces a good using a very labour-intensive process. There is an increase in the price of the good. Under which conditions will the supply of the firm's good be most price elastic?
Anature of the labour employed by the firm: skilled, level of unemployment in the economy: high
Bnature of the labour employed by the firm: skilled, level of unemployment in the economy: low
Cnature of the labour employed by the firm: unskilled, level of unemployment in the economy: high
Dnature of the labour employed by the firm: unskilled, level of unemployment in the economy: low
✓ Correct answer
C: nature of the labour employed by the firm: unskilled, level of unemployment in the economy: high
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