Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
The wage where the quantity of labor supplied equals the quantity of labor demanded
B
The highest wage offered by employers
C
The lowest wage workers are willing to accept
D
The wage that results in labor shortages
Understanding the Answer
Let's break down why this is correct
Answer
The equilibrium wage in a labor market is the wage at which the number of workers that employers want to hire equals the number of workers willing to work. This balance happens when the supply of labor meets the demand for labor. For example, if a company needs 10 workers and there are 10 people looking for jobs, the wage they agree on is the equilibrium wage. If the wage is too high, employers may hire fewer workers, and if it’s too low, more people will want to work than there are jobs available. So, the equilibrium wage helps ensure that both workers and employers are satisfied in the job market.
Detailed Explanation
The equilibrium wage is where the number of workers wanting jobs matches the number of jobs available. Other options are incorrect because Some might think the highest wage is the best; It's easy to think the lowest wage is the answer.
Key Concepts
equilibrium wage
Topic
Demand and Supply in Labor Markets
Difficulty
easy level question
Cognitive Level
understand
Ready to Master More Topics?
Join thousands of students using Seekh's interactive learning platform to excel in their studies with personalized practice and detailed explanations.