In the short run, _______ increases the quantity of labour demanded by the firm.
A) a decrease in the price of the firm's output
B) an increase in the prices of other factors of production used by the firm
C) a decrease in the wage rate
D) a technological advance that decreases the marginal product of labour

Question

Quizplus · Accepted Answer

A decrease in the wage rate makes hiring additional workers less expensive for the firm, thereby increasing the quantity of labor demanded.

In the Short Run, _______ Increases the Quantity of Labour