QuestionMay 25, 2025

Which of the following results in a rightward shift of the market demand curve for labor? a decrease in labor productivity a decrease in the firm's product price an increase in the wage rate an increase in demand for the firm's product

Which of the following results in a rightward shift of the market demand curve for labor? a decrease in labor productivity a decrease in the firm's product price an increase in the wage rate an increase in demand for the firm's product
Which of the following results in a rightward shift of the
market demand curve for labor?
a decrease in labor productivity
a decrease in the firm's product price
an increase in the wage rate
an increase in demand for the firm's product

Solution
4.3(230 votes)

Answer

An increase in demand for the firm's product Explanation 1. Identify Factors Affecting Labor Demand A rightward shift in the market demand curve for labor occurs when there is an increase in demand for labor at each wage rate. 2. Analyze Each Option - **Decrease in labor productivity**: Reduces demand for labor, shifting the curve left. - **Decrease in the firm's product price**: Lowers revenue, reducing labor demand, shifting the curve left. - **Increase in the wage rate**: Does not shift the demand curve; it moves along the curve. - **Increase in demand for the firm's product**: Increases need for production, increasing labor demand, shifting the curve right.

Explanation

1. Identify Factors Affecting Labor Demand<br /> A rightward shift in the market demand curve for labor occurs when there is an increase in demand for labor at each wage rate.<br /><br />2. Analyze Each Option<br /> - **Decrease in labor productivity**: Reduces demand for labor, shifting the curve left.<br /> - **Decrease in the firm's product price**: Lowers revenue, reducing labor demand, shifting the curve left.<br /> - **Increase in the wage rate**: Does not shift the demand curve; it moves along the curve.<br /> - **Increase in demand for the firm's product**: Increases need for production, increasing labor demand, shifting the curve right.
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