An Increase in the Population and Hence the Supply of Labour

question 99

Multiple Choice

An increase in the population and hence the supply of labour causes a

• A)shortage of labour at the original real wage rate and the real wage rate will fall.
• B)shortage of labour at the original real wage rate and the real wage rate will rise.
• C)surplus of labour at the original real wage rate and the real wage rate will rise.
• D)surplus of labour at the original real wage rate and the real wage rate will fall.

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Definitions:

Consumer Income

The total amount of money earned by an individual or household that affects their buying habits and purchasing power.

Complements

Goods or services that are used together, where the use of one increases the value or demand for the other, like smartphones and data plans.

Substitutes

Goods or services that can be used in place of each other to satisfy consumer preferences or needs.

Substitute Product

A good or service that can be used in place of another to satisfy similar needs or desires.