Suppose an Increase in the Demand for Labor Results in an Increase

question 435

Multiple Choice

Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

• A)The VMPL increases by less than $4.
• B)The VMPL increases by $4.
• C)The VMPL increases by more than $4.
• D)The VMPL decreases by $4.

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Definitions:

Diplomacy

The conduct by government officials of negotiations and other relations between nations, often involving the exchange of ambassadors and the use of peaceful negotiations.

Private Sector

The part of the economy that is run by individuals and companies for profit, as opposed to the public sector, which is managed by the government.

Regulatory Agency

A government body responsible for directing and enforcing specific regulations to ensure that standards and laws are followed within specific industries or sectors.

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Limitations or constraints placed on activities, behaviors, or movements.