Question

When the labor market is doing very well and jobs are easy to get, we would expect:

The labor force to increase as previously discouraged workers re-entered the labor force.

The labor force to decrease as previously discouraged workers choose to remain unemployed.

The labor force to stay the same because the labor market is in equilibrium at that point

The labor force to increase because the overall population of the country should shrink.

The labor force to increase because the overall population of the country should increase because of immigration

Answer 1

A. The labor force to increase as previously discouraged workers re-entered the labor force.

Step-by-step explanation:

When the labor market is doing very well and jobs are easy to get, we would expect the labor force to increase as previously discouraged workers re-entered the labor force.

This ultimately implies that, when the labor market is performing exceptionally or excellently and the unemployment rate is very low because people are able to secure employment easily, there would be a significant increase in the number of people employed and as such leading to an increase in the labor force as more people would be motivated to join the labor force.

Hence, an optimal and efficient economy is one that is characterized mainly by a low unemployment rate with previously discouraged workers being motivated to come back into the labor force.