In an industry where all employers offer essentially similar goods and services,a wage increase is easy to pass on to customers.

Question

Quizplus · Accepted Answer

In a competitive industry, competitors may not be able to easily pass on the cost of increased wages to customers. They may need to absorb the cost themselves to remain competitive or risk losing customers to lower-priced competitors. Additionally, demand for the industry's goods or services may not be inelastic enough to support price increases.

In an Industry Where All Employers Offer Essentially Similar Goods