Respuesta :
Answer:
(C) decrease as the supply of college educated labor increases.
Explanation:
Labour Markets: with employees as labour sellers/ suppliers & firms as labour buyers/ demanders ; are at equilibrium where Labour Demand = Labour Supply.
Labour Demand curve is downward sloping because of wage - demand inverse relationship. Labour Supply curve is upward sloping because of wage - supply direct relationship.
An increase in supply of certain labour supply shifts labour supply curve rightwards. This creates excess supply of that labour & competition among sellers (prospective employees) reduces their price i.e wage rates.
Above explanation perfectly explains the case of college degree holders, whose supply increase would lower down their wages.
