Question

If wage increases by 10%, a(n) ________ worker is likely to supply 7% more labor because elasticity of labor supply is assumed to be ________. Group of answer choices teenager; elastic. adult; elastic. adult; inelastic.

Answer 1

adult; inelastic.

Step-by-step explanation:

Data provided in the question

Increase wage rate percentage is 10%

And, the given supply percentage is 7%

As there is no information given in the question related to the teenager and adult so we assume that the data is given for adult

Since the wage rate is increase by 10% which reflects the adults worker and due to which the supply is 7% more labor. So the elasticity of labor supply is inelastic as the supply is less than the wage rate so it cannot be perfectly elastic