Which of the following decreases in labor demand is due to a change in the price of a related resource?
A)A decline in the demand for computers in Europe reduces the demand for workers in the domestic computer industry.
B)The rise of hair salons for both men and women reduces the demand for barbers.
C)A decrease in the educational skills of manufacturing workers decreases the demand for such workers.
D)An increase in the price of chemical equipment increases the cost of producing fertilizer, thus decreasing the demand for workers who make fertilizer.

Question

Quizplus · Accepted Answer

An increase in the price of chemical equipment, which is a related resource to the production of fertilizer, directly affects the cost of producing fertilizer. This increase in production cost can lead to a decrease in the demand for workers in the fertilizer industry as companies may seek to cut costs or reduce production.

Which of the Following Decreases in Labor Demand Is Due