An increase in the price of labor (a variable resource)shifts
A) all cost curves upward.
B) the variable cost curves upward but leaves the fixed cost curves unchanged.
C) the fixed cost curves upward but leaves the variable cost curves unchanged.
D) the marginal cost curve rightward.
E) none of the cost curves.

Question

Quizplus · Accepted Answer

An increase in the price of labor will lead to an increase in variable costs, but fixed costs will remain unchanged. Therefore, only the variable cost curves will shift upwards, and the fixed cost curves will not be affected.

An Increase in the Price of Labor (A Variable Resource)shifts