A new technology makes workers more productive. What happens to the real wage in a competitive...

A new technology makes workers more productive. What happens to the real wage in a competitive market?
Select one:
a. It goes down
b. It goes up
c. It reduces demand for workers
d. It doesn’t change

Solutions

Expert Solution

Option b

With the increase in productivity, the marginal product of a labor increases which increases the demand for labor, hence wages of the labor too increases.

Rahul Sunny answered 1 year ago

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