An increase in the supply of labour as a result of population growth causes

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An increase in the supply of labour as a result of population growth will shift the labour supply curve to the right, as there are more people available to participate in the workforce. This increase in supply will not necessarily lead to an increase in the real wage rate, as the equilibrium wage rate will be determined by the intersection of the demand and supply curves in the labour market. Depending on the extent to which demand for labour shifts to the right, the wage rate may increase or decrease, and this will be reflected in changes in the nominal wage rate.

An Increase in the Supply of Labour as a Result