Refer to the Information Provided in Figure 28

Multiple Choice

Refer to the information provided in Figure 28.4 below to answer the question(s) that follow. Figure 28.4
-Refer to Figure 28.4. The demand for labor rises from D' to D. If firms had entered into explicit contracts with workers that set wages for 3 years, then the wage rate will ________ and employment will ________.

A) remain at $8; rise to 400 million
B) remain at $10; fall to 200 million
C) rise to $10; remain at 200 million
D) rise to $10; rise to 300 million