In the neoclassical view of the macroeconomy, too many workers seeking work or unemployment will lead to
A) falling wages.
B) rising wages.
C) rising interest rates.
D) government programs to help the unemployed.

Question

Quizplus · Accepted Answer

According to the neoclassical view, an excess supply of labor (too many workers seeking work) will result in a surplus of workers, leading to a decrease in wages. The theory is that as wages fall, employers will be able to hire more workers, which will eventually decrease the unemployment rate. Therefore, the correct answer is A) falling wages.

In the Neoclassical View of the Macroeconomy, Too Many Workers