If the Supply of Labor Increases, Which of the Following

question 159

Multiple Choice

If the supply of labor increases, which of the following events will occur?

• A) The wage rate will fall and firms will increase employment up until the point where MRP equals the new wage rate.
• B) The wage rate will fall and firms will decrease employment to the point where MRP equals the new wage rate.
• C) The wage rate will increase and firms will decrease employment to the point where MRP equals the new wage rate.
• D) The wage rate will increase and firms will increase employment up until the point where MRP equals the new wage rate.

---

Definitions:

IQ Tests

Standardized assessments designed to measure human intelligence and cognitive abilities against an average score for a given population.

Innate Ability

Natural talents or skills that a person is born with, not acquired through learning.

School Performance

The assessment of a student’s academic work in terms of grades, test scores, and teacher evaluations.

Intelligence

The ability to learn from experience, solve problems, and use knowledge to adapt to new situations.