Refer to the graph above to answer this question. Suppose that the original supply and demand curves for labour are 5 1
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and D 1
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and that the mark is in equilibrium at point e. What can you conclude has happened if a new wage rate of W 2
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and quantity of Qb occur? W 2
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is a non-equilibrium wage rate that may be the result of successful bargaining by a strong trade union. Both the supply of and the demand for labour have decreased. The demand for labour has decreased and the supply has increased. The supply of labour has decreased and the demand has increased.