-(Exhibit: Wage Determination in Perfect Competition) Which of the following is true? A) The firm will hire L₁ units of labor, as shown in Panel (a). B) The labor market will hire l₁ units of labor, as shown in Panel (b). C) The wage of labor is W₁. D) The curve labeled s₁ in Panel (b) is the firm's demand curve for labor.

Question

Quizplus · Accepted Answer

In perfect competition, the wage of labor is determined by the intersection of the supply and demand curves in the labor market, which is represented by W₁.

-(Exhibit: Wage Determination in Perfect Competition) Which of the Following