Given a fixed labor supply schedule that slopes upward, an increase in the capital stock of the economy is expected to

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Quizplus · Accepted Answer

An increase in the capital stock of the economy makes labor more productive, which typically leads to an increase in the demand for labor. This, in turn, increases employment and raises the real wage, as employers are willing to pay more for the now more productive labor.

Given a Fixed Labor Supply Schedule That Slopes Upward, an Increase