If the Wage Rate Increases and Firms in a Perfectly

question 329

Multiple Choice

If the wage rate increases and firms in a perfectly competitive industry are hiring labor, then

• A) the firms will quit using labor.
• B) profits will increase.
• C) market supply will decrease.
• D) market price will decrease.

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Definitions:

Liability

An obligation of the company that arises from past transactions or events, leading to a probable future sacrifice of economic benefits.

Internal User

individuals within an organization who use financial information to make decisions, including managers and employees.

Accounting Data

Information and records relating to the financial activities of a business, including transactions, balances, and other financial statements.

Labour Union

An organization that represents the collective interests of workers in negotiations with employers over wages, working conditions, and other employment terms.