o e. technologically more advance than other firms in the market. QUESTION 39 At
ID: 1143170 • Letter: O
Question
o e. technologically more advance than other firms in the market. QUESTION 39 At a wage below the equilibrium level, the: O a. quantity of labor demanded exceeds the quantity of labor supplied, resulting in a labor surplus O b. quantity of labor supplied exceeds the quantity of labor demanded, resulting in a labor surplus. c. quantity of labor supplied exceeds the quantity of labor demanded, resulting in a labor shortage. d. quantity of labor demanded exceeds the quantity of labor supplied, resulting in a labor shortage e. quantity of labor demanded and the quantity of labor supplied remains constant, decreasing the wage rate. QUESTION 40 The marginal resource cost of labor is the amount that an extra unit of labor adds to the firm's average costs True False QUESTION 41 The table below shows a portion of the demand schedule faced by a monopoly firm. Based on the table, the marginal equals Table 8-3 Price Quantity $12Explanation / Answer
39.
Correct Answer:
D
When, the wage rate is below the equilibrium, then less labor is supplied, but higher quantity of labor is demanded as it is cheap. It creates labor shortage, that pushes the wage rate to the upward direction and equilibrium wage rate is achieved in the market.
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