refer to the following diagram. Initially, wage rates are WM in Country M and WU in Country U. Subsequent migration results in an equalization of wage rates.
-Migration causes the value of output in Country M to:

Question

refer to the following diagram. Initially, wage rates are WM in Country M and WU in Country U. Subsequent migration results in an equalization of wage rates.

-Migration causes the value of output in Country M to:

Quizplus · Accepted Answer

Migration causes the supply of labor to increase in Country U and decrease in Country M, resulting in a decrease in wage rates in Country U and an increase in wage rates in Country M. As a result, the value of output in Country M will decrease by the area ebcf, which represents the decrease in surplus enjoyed by firms due to the increase in wage rates.

Refer to the Following Diagram