Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
An increase in the marginal product of labor
B
A decrease in the price of the final product
C
Improved technology that enhances worker productivity
D
A rise in minimum wage laws
E
A decrease in the number of firms in the market
Understanding the Answer
Let's break down why this is correct
Answer
Several factors can lead to a shift in the demand for labor in a firm. One important factor is changes in the demand for the firm's products or services. For example, if a bakery becomes very popular and sells more bread, it will need to hire more bakers to meet that demand. Another factor is advancements in technology, which can either increase the need for skilled workers or reduce the need for labor if machines can do the work instead. Additionally, changes in the overall economy, such as a recession or boom, can also affect how many workers a firm needs.
Detailed Explanation
None of the options provided actually lead to a shift in labor demand. Other options are incorrect because Some might think that if workers are more productive, firms will want to hire more; It's easy to think that if the price of a product goes down, firms will hire less.
Key Concepts
Demand for Labor
Marginal Product of Labor
Market Conditions
Topic
Demand and Supply in Labor Markets
Difficulty
hard level question
Cognitive Level
understand
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