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Business, 10.03.2020 07:06 raynaesquivel

Suppose our firm produces chartered business flights with capital (planes) and labor (pilots) in fixed proportion (i. e., one pilot for each plane). If the wage rate paid to the pilots increases relative to the rental rate of capital for the airplanes, then:A. Optimal capital labor ratio should increase.
B. Optimal capital labor ratio should decrease.
C. optimal capital labor ratio remains the same
D. Not enough information to answer question

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