Which of the Following Best Describes the Substitution Effect of a Wage

question 23

Multiple Choice

Which of the following best describes the substitution effect of a wage increase?

• A)The firm's marginal cost increases,the firm desires to produce less output,and therefore less labor is required
• B)The cost of labor is relatively higher,causing the firm to use relatively less labor
• C)The firm's labor demand curve becomes less elastic,causing it to employ less labor
• D)The firm's labor demand curve becomes more elastic,causing it to employ less labor

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Definitions:

Adhesion Molecules

Proteins located on the cell surface that are involved in the binding with other cells or with the extracellular matrix.

Speech Sounds

Speech sounds are the auditory signals or phonemes that are produced by the human vocal apparatus to form the building blocks of spoken language.

Discriminate

The act of recognizing or noting the difference between things; often used in context where unfair treatment is based on differences like race, gender, age, etc.