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Which of the Following Statements About Labor Supply Is True

Question 41

Multiple Choice

Which of the following statements about labor supply is true?


A) The wage rate has no effect on labor supply decisions, and the typical labor supply curve is perfectly vertical.
B) The wage rate is the only factor affecting labor supply decisions, and the typical labor supply curve is upward sloping.
C) Labor supply decisions are affected by wage and nonwage factors, and the typical labor supply curve is upward sloping.
D) Labor supply decisions are affected by nonwage factors such as location and psychological rewards, and because of this the typical labor supply curve is horizontal at the going wage rate.

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