Vanek (1970) and Meade (1974) analyse this case and reconfirm the major results of the competitive case: (a) the CF will always expand more or contract less than the LMF when demand rises; (b) an increase in debt interests will leave the short run output of the CF unchanged but will give the LMF an incentive to increase output and employment; (c) the prosperous CF will employ more labour per unit of capital and hence produce more.