Which of the following can bring about an increase in the demand for labor?

Question

Quizplus · Accepted Answer

An increase in the demand for the product that labor produces will lead to an increase in the demand for labor as firms will need to hire more workers to produce more of the product to meet the increased demand. A decrease in the marginal physical product of labor (B) will lead to a decrease in the demand for labor as firms will need fewer workers to produce the same amount of output. A decrease in the price of labor (C) will not necessarily lead to an increase in the demand for labor as firms may substitute capital for labor due to the lower cost of labor, resulting in a decrease in the demand for labor. An increase in the price of labor (D) may lead to a decrease in the demand for labor as firms may substitute capital for labor due to the higher cost of labor, resulting in a decrease in the demand for labor.

Which of the Following Can Bring About an Increase in the Demand