An increase in the price of automobiles shifts the demand for autoworkers to the ?
Correct answer: C. right and increases the wage
- A. left and decreases the wage
- B. right and decreases the wage
- C. right and increases the wage
- D. left and increases the wage
Explanation
A higher automobile price raises the value of the output produced by autoworkers, shifting the derived demand for their labor to the right. The resulting equilibrium wage rises.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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