Suppose the Labor Supply Curve Facing All Industries in an Economy

question 81

Multiple Choice

Suppose the labor supply curve facing all industries in an economy is a vertical line.Given this,which of the following statements about the supply curve of labor confronting any particular industry is true?

• A)The supply curve of labor confronting any particular industry will also be vertical because the aggregate supply curve is a horizontal summation of industry supply curves.
• B)The supply curve of labor confronting any particular industry will also be inelastic because the stock of labor in the economy is fixed in the short-run.
• C)The supply curve of labor confronting any particular industry will be elastic because labor can shift easily from one industry to another.
• D)The supply curve of labor confronting any particular industry will be elastic because labor and capital are perfectly substitutable in the short-run.

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Definitions:

Payoffs

Payoffs refer to the outcomes or potential returns from making a particular decision or investment in various contexts, including economics, game theory, and finance.

Annual Profits

The total income a company generates in one fiscal year after all expenses and taxes have been subtracted from its total revenue.

Good Quality Product

A product characterized by excellence in materials, craftsmanship, performance, and durability, meeting or exceeding consumer expectations.

Duopoly Market

A market structure where two companies own all or nearly all of the market for a given product or service.