Assume that markets clear.If in the labor market there is
A) an excess supply of labor,wages will rise
B) an excess demand for labor,wages will fall
C) an excess demand for labor,wages will rise
D) an excess supply of labor,wages stay constant
E) a decline in labor demand,wages will rise

Question

Quizplus · Accepted Answer

When there is excess demand for labor, it means that there are more job openings than the number of available workers to fill those positions. As a result, employers must offer higher wages in order to attract workers and fill the vacancies. So, wages will rise.

Assume That Markets Clear