Refer to the Diagram Below, Which Represents a Local Labor

question 20

Multiple Choice

refer to the diagram below, which represents a local labor market consisting of two submarkets. All workers are assumed to be identical.





-Suppose that the wage in B is higher because workers perceive disutility of $2 associated with this job relative to A.Assuming that information is perfect and mobility between jobs is costless,we can conclude that:

• A)the wage differential between jobs A and B is an equilibrium differential
• B)workers will flow from job A to job B
• C)workers will flow from job B to job A
• D)the demand for labor in B will fall and the demand for labor in A will rise

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