The quantity demanded of labour will decrease if:
A) the price of the product that the labour produces increases.
B) the productivity of labour increases.
C) the price of labour rises.
D) there is an increase in the supply of a factor labour uses.

Question

Quizplus · Accepted Answer

The quantity demanded of labour will decrease if the price of labour rises. This is because firms will substitute labour for other factors of production that now become relatively cheaper, such as capital or technology.

The Quantity Demanded of Labour Will Decrease If