Multiple Choice QuestionWhich of the following result in high wage rates in the industrially advanced nations?Multiple choice question.Strong demand and scarce supply of laborWeak demand and strong supply of laborStrong demand and strong supply of laborWeak demand and weak supply of labor
Question
Multiple Choice QuestionWhich of the following result in high wage rates in the industrially advanced nations?Multiple choice question.Strong demand and scarce supply of laborWeak demand and strong supply of laborStrong demand and strong supply of laborWeak demand and weak supply of labor
Solution
The answer is "Strong demand and scarce supply of labor".
Here's why:
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Wage rates are determined by the demand and supply of labor in the market.
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When the demand for labor is strong, it means that employers are willing to hire more workers. This could be due to various reasons such as economic growth, technological advancements, or increase in production.
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On the other hand, when the supply of labor is scarce, it means that there are not enough workers available to meet the demand. This could be due to various reasons such as low population growth, high skill requirements, or geographical constraints.
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In such a situation, employers would be willing to pay higher wages to attract and retain the limited workers available. This results in high wage rates.
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Therefore, high wage rates in the industrially advanced nations are a result of strong demand and scarce supply of labor.
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