Which event could increase the demand for labour

Question

Quizplus · Accepted Answer

An increase in the marginal productivity of workers will increase the demand for labour as it means that each worker is producing more output and therefore the firm will require more workers to produce the desired level of output. A decrease in output price (A) would usually result in a decrease in the demand for labour as the firm is receiving less revenue for each unit of output produced. The decrease in available capital (B) may also result in a decrease in demand for labour as the firm may not be able to afford to hire additional workers or invest in new equipment which would increase the productivity of the existing workforce. An increase in the size of the labour force (D) may not necessarily increase the demand for labour, as it depends on the reason for the increase in the labour force and the impact on productivity.

Which Event Could Increase the Demand for Labour