If the supply of labor increases,then the equilibrium wage rate ________ and the equilibrium quantity of labor ________.
A) rises; increases
B) might rise, fall, or not change; increases
C) rises; might increase, decrease, or not change
D) falls; increases
E) falls; does not change

Question

Quizplus · Accepted Answer

According to the law of demand, as the supply of labor increases, the equilibrium wage rate (price of labor) will decrease, leading to an increase in the equilibrium quantity of labor (quantity demanded of labor). Therefore, choice D is the correct answer.

If the Supply of Labor Increases,then the Equilibrium Wage Rate