If the quantity of labor supplied increases by 5 percent when the wage increases by 10 percent, the elasticity of labor supply is:

Name: If the quantity of labor supplied increases by 5 percent when the wage increases by 10 percent, the elasticity of labor supply is:
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Quizplus · Accepted Answer

The elasticity of labor supply is calculated as the percentage change in quantity supplied divided by the percentage change in wage. Here, it is 5% / 10% = 0.5, which corresponds to choice B (1/2).

If the Quantity of Labor Supplied Increases by 5 Percent