Consider a color-blind firm that is currently maximizing profits. An affirmative action policy is put in place requiring that all firms in the industry abide by a certain quota. Which of the following will occur?
A. The firm will have to fire some workers.
B. If the firm currently meets the required quota, it will cut costs by adjusting labor to exactly meet the affirmative action requirements.
C. The firm will have to start hiring some workers that it would prefer not to.
D. If the firm currently meets the quota, it will begin to lose profits due to the affirmative action requirements.
E. If the quota is already met, the firm will make no changes in its hiring practices.
Answer: E
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A disadvantage of the barter system is that
A) no trade occurs. B) people must produce all their own food, clothing, and shelter. C) the opportunity to specialize is greatly reduced. D) gold is the only unit of account.
The relationship between the wage rate and the quantity of labor that employers wish to hire in total is called: a. the market supply curve for labor
b. the market demand curve for labor. c. an individual demand curve for labor. d. an individual supply curve for labor.
The opportunity cost of leisure will fall if
A. nonlabor income increases. B. the wage rate increases. C. the wage rate decreases. D. nonlabor income decreases.
The following table shows cost data for a firm that is selling in a purely competitive market.
Refer to the above table. Now assume there are 100 identical firms in this industry, each of which has the same cost data as the single firm described above. Suppose too that the demand curve for this industry is as shown below:
The equilibrium price will be:
A. $140
B. $180
C. $230
D. $290