Figure 14.2.2
-Refer to Figure 14.2.2 above. Along the supply curve, up to point A, some workers would have worked for less than the going wage rate. This concept is represented by:
A) Area B.
B) Area C.
C) the rectangle (w* × L*).
D) none of the above

Question

Figure 14.2.2
-Refer to Figure 14.2.2 above. Along the supply curve, up to point A, some workers would have worked for less than the going wage rate. This concept is represented by:
A) Area B. 
B) Area C. 
C) the rectangle (w* × L*). 
D) none of the above

Quizplus · Accepted Answer

Area B represents the concept of consumer surplus in the context of labor supply, indicating the difference between what workers are willing to accept and what they actually receive up to point A. This area shows the extra benefit workers receive because some of them would have been willing to work for less than the going wage rate.

Figure 14.2.2 -Refer to Figure 14.2.2 Above. Along the Supply Curve, Up