Suppose That the Market for Labor Is Initially in Equilibrium

question 241

Multiple Choice

Suppose that the market for labor is initially in equilibrium.A decrease in the price of output will cause

• A) the equilibrium wage and the quantity of labor to both rise.
• B) the equilibrium wage and the quantity of labor to both fall.
• C) the equilibrium wage to rise and the quantity of labor to fall.
• D) the equilibrium wage to fall and the quantity of labor to rise.

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