The above figure shows supply and demand curves for apartment units in a large city. If the city government passes a law that establishes $450 per month as the legal maximum rent, consumer surplus will be
A) a.
B) a + b + f.
C) a + b + c.
D) a + b + c + f + g.
B
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Compensating differentials are
A) non-monetary benefits from being employed, such as health-care benefits. B) higher wages that compensate the more experienced workers in a field. C) wages paid to workers where the supply of labor is great relative to demand. D) higher wages that compensate workers for unpleasant aspects of a job.
An insurance company offering a high-deductible plan is an example of:
A. screening. B. signaling. C. statistical discrimination. D. building a reputation.
Firms that have high cost of monitoring, choose their employees much more carefully because
a. They are afraid that the employee would be too productive b. They are more confident that after getting the job, the employee would not shirk c. They are afraid that without screening, the employee would be more likely to shirk d. B & C
Firms that are required to participate in affirmative action programs do end up hiring more minority employees
a. True b. False