1. In this example there isn't sufficient time for the supply of web programmers to increase, only the demand curve for web programmers shifts out. The demand increase leads to an increase in both the number of programmers and their wages. In the graph to the right, D2 represents the increased demand, W2 the higher equilibrium wage and N2 the increased number hired.

   If there had been time for the supply of web programmers to increase (time for more people to obtain the necessary skills), the supply curve would have shifted out as well. In this case, even more people would have been employed, but the change in their wage would have been indeterminate. The graph to the left illustrates such a scenario.

   Let's consider the incorrect choices one by one:

  1. Wages will fall and the number employed will fall would require a shift back in the demand for programmers, meaning that firms find them less useful.
  2. Wages will remain constant and the number employed will increase. This would require a shift in supply as well as a shift in demand and, for the time period being considered, this isn't possible.
  3. Wages will rise and the number employed will fall. This would require a shift back or reduction in the supply of web programmers. This could result if other jobs requiring the same skills began paying even more.
  4. Wages will fall and the number employed will increase. This would require a shift out in supply without any change in demand.

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