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Dymondmonae Dymondmonae
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5 years ago

Question 1.

In general, the labor supply curve

• slopes downward because firms will hire fewer workers at higher wages.

• slopes upward because as the wage rises, the opportunity cost of leisure increases.

• is vertical at the equilibrium wage rate.

• is perfectly elastic at the equilibrium wage rate.

Question 2.

Which of the following helps to explain why the supply curve of labor is upward sloping?

• The supply curve of labor is a derived supply curve; since the output supply curve is upward-sloping, so is the labor supply curve.

• As the wage rate rises, the income effect causes the quantity of labor supplied to increase.

• The substitution effect of a price change makes a good less expensive relative to other goods.

• As the wage rate rises, the opportunity cost of leisure rises.
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Microeconomics

Microeconomics


Edition: 7th
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Brittany08196Brittany08196
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Dymondmonae Author
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5 years ago
Helps a lot... Now I'm ready for my quiz
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