Consider the Labor Market for Computer Programmers,which Is in Equilibrium

question 152

Multiple Choice

Consider the labor market for computer programmers,which is in equilibrium.During the late 1990s,the value of the marginal product of all computer programmers increased dramatically.Holding all else equal,what effect did this process have on the labor market for computer programmers?

• A)The equilibrium wage increased, and the equilibrium quantity of labor increased.
• B)The equilibrium wage increased, and the equilibrium quantity of labor decreased.
• C)The equilibrium wage decreased, and the equilibrium quantity of labor increased.
• D)The equilibrium wage decreased, and the equilibrium quantity of labor decreased.

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Definitions:

Industry Supply Curve

A graphical representation showing the total quantity of a good that producers in an industry are willing to supply at various prices.

Individual Supply Curves

Graphical representations that show the relationship between the price of a good and the quantity of the good that a single producer is willing to supply.

Short-run

A period of time in which at least one input is fixed and cannot be changed, affecting the capacity to adjust production levels.

Long-run Equilibrium

A state in which all factors of production and inputs can be fully adjusted, and there are no fixed variables, resulting in market supply equalling market demand.