Responses
Firms will hire fewer workers at higher wages.
Firms will hire fewer workers at higher wages.
Higher wages increase the quantity of labor that workers are willing to engage in.
Higher wages increase the quantity of labor that workers are willing to engage in.
Higher wages reduce the quantity of leisure that workers are willing to engage in.
Higher wages reduce the quantity of leisure that workers are willing to engage in.
Firms will hire fewer workers at lower wages.
1 answer
The correct response is:
Firms will hire fewer workers at higher wages.
This is because, as wages increase, the cost of hiring additional workers rises, leading firms to reduce the number of workers they are willing to employ based on the principle of diminishing marginal returns. Therefore, the demand for labor typically slopes downward.
