The labor demand curve is:

Question

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The labor demand curve shows the relationship between the quantity of labor demanded by firms and the wage rate. As firms receive a lower real wage, it becomes cheaper for them to hire more workers, leading to an increase in the quantity of labor demanded. Thus, the labor demand curve is downward sloping. Choice A and D are incorrect because a lower real wage would typically encourage workers to work more, not less, as they are incentivized to work longer hours or take on additional jobs. Choice C is also incorrect because a lower real wage does not entice firms to hire fewer workers.

The Labor Demand Curve Is