passwella.
Menu

JAMB Economics 1992 Question 10

Question 10

Theory of Production

The higher the price of capital relative to the price of labour, the more production techniques should be

  1. A.labour-intensive
  2. B.capital-intensive
  3. C.fixed
  4. D.technology-intensive
Show the answer and explanation

Answer: A (labour-intensive)

Explanation

A firm uses more of the factor that is relatively cheap; if capital is dear, it uses more labour.