Answer:
A. The demand for labour has increased
Step-by-step explanation:
The demand for labour is done by firms , supply by the labourers themselves. As usual commodity demand curve , this demand curve is also downward sloping because of inverse wage - labour demand relationship (more labour demand at lower wages & vice versa).
Labour supply curve -by labourers : is upward sloping (upto a point) because of direct wage , labour supply relationship (more labour supply at higher wages & vice versa)
If the demand for labour increases , the downward sloping demand curve shifts rightwards. Interacting with unchanged upward sloping supply curve - labour excess demand pushes the wages upwards , labour employed rightwards. It increases both price (wage) & quantity (employment) .
If supply decreases, excess demand still increases wages , but the new employment level is lesser .If supply increases , excess supply implies more employment at lower wages . Decreased demand leads to less employment & lower wage rates .