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WAEC Economics 2020 Question 26

Question 26

Labour Market

In the long run, as individuals receive higher wages, it causes

  1. A.demand for food to decrease.
  2. B.demand for leisure to decrease.
  3. C.supply of normal goods to decrease.
  4. D.supply of labour to decrease.
Show the answer and explanation

Answer: D (supply of labour to decrease.)

Explanation

Beyond a point, higher wages let people afford more leisure, so they offer less labour (backward-bending supply).