Without any change in the supply of labor, how will shifts in the demand for labor affect equilibrium wage and employment?
What will be an ideal response?
Because the equilibrium wage and employment are determined at the point of intersection of the labor demand and supply curves, shifts in the demand curve affect these variables. A right shift in the demand for labor, without any change in the supply of labor, will lead to higher wages and employment levels. On the other hand, a left shift in the demand for labor, without any change in the supply of labor, will lead to lower wages and employment levels.
You might also like to view...
M1 does not include cash that is held in ATMs or bank vaults, because ________
A) no one really owns that money B) that money is included in M2 C) that money earns no interest D) the right to access that money is counted already as bank deposits E) none of the above
The difference in wage rates needed to make two jobs equally attractive to workers is known as a(n)
a. equilibrium wage rate b. competitive wage c. equalizing wage d. compensating wage differential e. efficient wage