Given an increase in the demand for labor, the more the supply of labor rises:
A) the greater the increase in wages.
B) the less the increase in wages and the greater the number of workers employed.
C) the greater the increase in workers employed at the original wage rate.
D) the fewer the number of workers employed.

Question

Quizplus · Accepted Answer

When there is an increase in demand for labor, the supply of labor also increases. This increased supply will lead to wage rates that are not as high as they would be if the supply did not increase. This means that there will be fewer workers employed at their original wage rate. However, with the increased supply of labor, the number of workers employed will increase. Thus, option B is the correct answer.

Given an Increase in the Demand for Labor, the More