When the government requires that a person have a license to work in a particular occupation, then in the labor market for that occupation:
A)supply decreases.
B)supply increases.
C)demand decreases.
D)demand increases.

Question

Quizplus · Accepted Answer

When the government requires a license to work in a particular occupation, it restricts entry into that occupation. This decreases the supply of workers in that labor market, as not everyone will meet the requirements for a license. Therefore, the correct choice is A.

When the Government Requires That a Person Have a License