An increase in the wage rate causes
A)a rightward shift of the firm's labor demand curve.
B)a leftward shift of the firm's labor demand curve.
C)a decrease in the quantity of labor demanded.
D)an increase in labor's marginal productivity.

Question

Quizplus · Accepted Answer

An increase in the wage rate leads to a decrease in the quantity of labor demanded because firms will hire fewer workers at higher wages, assuming other factors remain constant.

An Increase in the Wage Rate Causes