If Wages Increase at a 5% Rate and the Quantity

question 130

Multiple Choice

If wages increase at a 5% rate and the quantity demanded of labor decreases by 10%, then the demand curve for labor is

• A) elastic.
• B) inelastic.
• C) unitary.
• D) horizontal.

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Definitions:

Sales Tax

A tax imposed by government on sales of goods and services, typically computed as a percentage of the sale price.

Delivery Charge

A fee charged by a seller to cover the cost of delivering goods to a buyer's location.

Valuation Rate

The interest rate or discount rate used in determining the present value of future cash flows or in appraising the value of an asset.

Market Value

The current price at which an asset or service can be bought or sold in a competitive marketplace.