Economic theory suggests that discriminating employers will be driven from the marketplace when the output market is competitive. Why?

A. The government mandates that the employer not act on his or her desire to discriminate.
B. A competitive output market requires all workers to be paid the same wage.
C. Workers will refuse to work for a discriminating employer.
D. Customers will refuse to purchase from a discriminating employer.
E. Discrimination imposes an additional cost on the employer, and high-cost firms are eventually driven out of a competitive output market.


Answer: E

Economics

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