Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
The quantity of labor supplied equals the quantity of labor demanded
B
There is a surplus of labor
C
There is a shortage of labor
D
Wages are set by the government
Understanding the Answer
Let's break down why this is correct
Answer
At the equilibrium wage in the labor market, the amount of workers that employers want to hire matches the number of workers who want to find jobs. This balance means that there are no shortages or surpluses of labor; everyone who wants to work at that wage can find a job. For example, if the equilibrium wage is $15 per hour, employers will hire exactly the number of workers who are willing to work for that wage. This situation helps to keep the labor market stable because it means that both employers and employees are satisfied. When the wage is above or below this level, it can lead to either too many job seekers or not enough, causing problems in the market.
Detailed Explanation
At the equilibrium wage, the amount of workers wanting jobs matches the number of jobs available. Other options are incorrect because A surplus means there are more workers than jobs; A shortage means there are more jobs than workers.
Key Concepts
Equilibrium wage
Topic
Labor Supply and Demand Graphing
Difficulty
easy level question
Cognitive Level
understand
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