What Is the Relationship Between Wages and the Supply of Labor

question 156

Multiple Choice

What is the relationship between wages and the supply of labor?

• A) The higher the wage, other things constant, the more labor supplied.
• B) The higher the wage, other things constant, the less labor supplied.
• C) The higher the wage, other things constant, firms hire more workers.
• D) The higher the wage, other things constant, firms hire fewer workers.
• E) There is no relationship between wages and labor.

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Definitions:

Random Variable

A random variable is a variable whose values depend on outcomes of a random phenomenon.

Manufacturer

An entity or company that makes goods for sale through the process of manufacturing.

Net Income

The amount of profit that remains after all operating expenses, taxes, and interest have been deducted from total revenue.

Random Variable

A variable that can take on different values randomly, subject to a certain probability distribution.