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Figure: Equilibrium in the Labor Market
-(Figure: Equilibrium in the Labor Market) In the figure Equilibrium in the Labor Market, a decrease in population that decreases the number of workers, when everything else stays the same, will lead to a(n) _____ in the equilibrium quantity of labor and a(n) _____ in the equilibrium price of labor.
A) increase; increase
B) decrease; increase
C) increase; decrease
D) decrease; decrease

Question

Use the following to answer questions:
Figure: Equilibrium in the Labor Market 
-(Figure: Equilibrium in the Labor Market) In the figure Equilibrium in the Labor Market, a decrease in population that decreases the number of workers, when everything else stays the same, will lead to a(n) _____ in the equilibrium quantity of labor and a(n) _____ in the equilibrium price of labor.
A) increase; increase 
B) decrease; increase 
C) increase; decrease 
D) decrease; decrease

Quizplus · Accepted Answer

A decrease in population reduces the supply of labor, leading to a decrease in the equilibrium quantity of labor and an increase in the equilibrium price of labor (wages).

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