The Supply of Labour to an Industry Is Generally Upward

question 3

Multiple Choice

The supply of labour to an industry is generally upward sloping because:

• A) The substitution effect and the scale effect of a wage change work in the same direction.
• B) The wage elasticity of labour supply is elastic.
• C) There are many workers working for an industry.
• D) It is more profitable for firms to hire more workers when labour is cheap.
• E) Workers are more willing to work when there are added incentives in the form of higher wages.

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Definitions:

Fundamental Conditions

Essential circumstances or factors that underlie and determine the nature of an environment, system, or situation.

Creative Potential

The capacity to generate original ideas, approaches, or solutions that are both novel and useful in a particular context.

Creative Process

A series of steps taken to develop and produce innovative ideas or solutions.

Four Stages

A general term that can refer to any process, development, or cycle that is characterized by four distinct phases or parts.