The price for a unit of labor is the wage rate.What happens to the quantity of labor demanded if the wage rate increases?
A)It increases.
B)It decreases.
C)It does not change.
D)The outcome depends upon the supply of the good.

Question

Quizplus · Accepted Answer

When the wage rate increases, firms are less willing to hire as many workers because it becomes more expensive to do so. Therefore, the quantity of labor demanded decreases.

The Price for a Unit of Labor Is the Wage