An increase in p will ________ the VMPL schedule and will lead to ________in the quantity of low-skill labor demanded.
A) shift up; an increase
B) shift up; a decrease
C) shift down; an increase
D) shift down; a decrease

Question

Quizplus · Accepted Answer

An increase in the price of the product (p) increases the value of the marginal product of labor (VMPL), shifting the VMPL schedule upward. This typically leads to an increase in the quantity of low-skill labor demanded, as firms are willing to hire more workers at each wage level due to the higher value each worker adds to the firm's revenue.

An Increase in P Will ________ the VMPL Schedule and Will