Question

The Bureau of Labor statistics identifies a trend in the labor market for doctors, where wages have increased significantly over the past several years. As a result of this trend, more individuals within the economy enter the labor market to become doctors. How does this influence wages and employment within the labor market?(1 point)
Responses

The market equilibrium wage will increase, and the equilibrium quantity of labor will decrease.
The market equilibrium wage will increase, and the equilibrium quantity of labor will decrease.

The market equilibrium wage will decrease, and the equilibrium quantity of labor will increase.
The market equilibrium wage will decrease, and the equilibrium quantity of labor will increase.

The market equilibrium wage will decrease, and the equilibrium quantity of labor will decrease.
The market equilibrium wage will decrease, and the equilibrium quantity of labor will decrease.

The market equilibrium wage will increase, and the equilibrium quantity of labor will increase.

Answer 1

When more individuals enter the labor market to become doctors due to increasing wages, this typically indicates an increase in the supply of doctors. As the supply of labor (doctors) increases, all else being equal, the market equilibrium wage will tend to decrease due to the greater availability of workers. However, the increase in supply should also increase the equilibrium quantity of labor as more individuals are actively seeking employment as doctors.

Therefore, the most accurate response would be:

**The market equilibrium wage will decrease, and the equilibrium quantity of labor will increase.**