The labor demand curve slopes
A) upward to illustrate that the more productive the worker,the higher the real wage the employer is willing to pay that worker
B) upward to illustrate that the higher the wage rate,the fewer workers are demanded
C) upward or downward in direct proportion to the rate of inflation
D) downward to illustrate that the lower the real wage,the more workers employers are willing to hire
E) downward to illustrate that the availability of workers is directly proportional to the real wage

Question

Quizplus · Accepted Answer

The labor demand curve slopes downward to illustrate that the lower the real wage, the more workers employers are willing to hire. This is because as the wage rate decreases, firms can afford to hire more workers and increase production at a lower cost, leading to a higher demand for labor. Conversely, as the wage rate increases, firms will demand fewer workers as it becomes more expensive to hire them.

The Labor Demand Curve Slopes