An Increase in the Real Wage Rate Will Cause

question 54

Multiple Choice

An increase in the real wage rate will cause

• A)the labour supply curve to shift to the right.
• B)the labour demand curve to shift to the left.
• C)both the labour supply curve and the labour demand curve to shift to the right.
• D)a movement along the labour demand curve.

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Definitions:

Market Failures

Situations where the allocation of goods and services by a free market is not efficient, often leading to a net social welfare loss.

Shortage

The amount by which the quantity demanded of a product exceeds the quantity supplied at a particular (below-equilibrium) price.

Market

Any institution or mechanism that brings together buyers (demanders) and sellers (suppliers) of a particular good or service.

Majority Voting

A decision-making process where the choice that gathers more than half of the votes wins, commonly used in democratic elections and organizations.