When the economy experiences sustained economic growth, the

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Sustained economic growth typically leads to increased business activity and expansion, which in turn increases the demand for labor. As a result, labor demand will increase, and the equilibrium wage will rise. Choice A is incorrect because when labor demand increases, the equilibrium wage typically rises rather than drops. Choice B is incorrect because sustained economic growth usually leads to an increase in labor supply as more workers enter the market, but the equilibrium wage still tends to rise due to increased demand. Choice D is incorrect because while an increase in labor supply can occur with sustained economic growth, it does not necessarily lead to higher equilibrium wages.

When the Economy Experiences Sustained Economic Growth, the