Suppose an Increase in the Demand for Labor Results in an Increase

question 435

Multiple Choice

Suppose an increase in the demand for labor results in an increase of $4 per hour in the equilibrium wage. How does the increase in the demand for labor affect the value of the marginal product of labor (VMPL) ?

• A)The VMPL increases by less than $4.
• B)The VMPL increases by $4.
• C)The VMPL increases by more than $4.
• D)The VMPL decreases by $4.

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