According to the specific-factors model, what happens when the supply of labor increases?
A) The number of workers employed will decrease.
B) The wages of workers will rise.
C) The marginal product of labor will increase.
D) The wages of workers will decrease.

Question

Quizplus · Accepted Answer

According to the specific-factors model, when the supply of labor increases, the wages of workers will decrease. This is because the increase in labor supply leads to a decrease in the marginal product of labor, which in turn causes a decrease in wages.

According to the Specific-Factors Model, What Happens When the Supply