jasaide15
jasaide15
14.12.2019 • 
Business

Suppose that a firm in a perfectly competitive and constant cost industry is initially in long run equilibrium at point a on the following isoquant. if the market demand curve for the firm's product suddenly and permanently shifted to the right, discuss what will happen to the firm's capital/labor ratio over time, i.e., in the short run and in the long run. (draw diagrams to support your reasoning and be explicit about your assumptions.

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