Multiple Choice
If the supply of labour decreases,which of the following events will occur?
A) The wage rate will decrease and firms will increase the number of workers to the point at which the value of marginal product equals the new wage rate.
B) The wage rate will decrease and firms will decrease the number of workers to the point at which the value of marginal product equals the new wage rate.
C) The wage rate will increase and firms will decrease the number of workers to the point at which the value of marginal product equals the new wage rate.
D) The wage rate will increase and firms will decrease the number of workers to the point at which the value of marginal product is greater than the new wage rate.
E) The wage rate will increase and firms will decrease the number of workers to the point at which the value of marginal product is less than the new wage rate.
Correct Answer:
Verified
Correct Answer:
Verified
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