The demand for labor would most likely become less inelastic as a result of
A)a decrease in the elasticity of the demand for the product that the labor produces.
B)a decrease in the time for employers to make technological changes or purchase new equipment.
C)a decrease in the proportion of labor costs to total costs.
D)an increase in the proportion of labor cost to total costs.

Question

Quizplus · Accepted Answer

An increase in the proportion of labor cost to total costs makes labor demand more elastic because changes in labor costs have a larger impact on total costs, prompting employers to be more responsive to changes in wages.

The Demand for Labor Would Most Likely Become Less Inelastic