Which of the Following Is the Effect of Anything That

question 93

Multiple Choice

Which of the following is the effect of anything that makes the efficiency wage rise relative to the market-clearing wage on the quantities of labour demanded and supplied?

• A)It increases both the quantity demanded and the quantity supplied of labour.
• B)It decreases both the quantity demanded and the quantity supplied of labour.
• C)It increases the quantity demanded and decreases the quantity supplied of labour.
• D)It decreases the quantity demanded and increases the quantity supplied of labour.

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Definitions:

Cash Flows

The total amount of money being transferred into and out of a business, particularly concerning its operating, investing, and financing activities.

Interest Rate

The amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.

Capital Budget

An estimate of the major capital and investment expenditures over a period, and the means of financing them.

Cost of Capital

The cost of a company's funds (both debt and equity), representing the rate of return that the company must earn on its investment projects to maintain its market value.