An increase in the minimum wage
a. increases both the quantity demanded and the quantity supplied of labor.
b. decreases both the quantity demanded and the quantity supplied of labor.
c. increases the quantity of labor demanded but decreases the quantity of labor supplied.
d. decreases the quantity of labor demanded but increases the quantity of labor supplied.
d
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The existence of a universal law of scarcity creates pressures on societies to
A. use their resources according to government plans. B. economize in the use of their resources. C. allocate their resources equitably. D. exploit their resources.
What is NOT true about rational choice?
A) It is the same for all individuals. B) It can result in different decisions for different individuals. C) It involves comparing costs and benefits. D) It might turn out not to have been the best choice after the event. E) It is a choice that uses the available resources to best achieve the objective of the person making the choice.
Which of the following arguments support the proposition that society should accept at least some income inequality?
A) Income redistribution will require taxation, causing inefficiently low levels of labor supply and saving, thus decreasing the size of the economic pie. B) Administrative costs associated with income redistribution imply that low-income people receive less than $1 for each dollar taken from high-income people. C) Income redistribution programs divert skilled labor and capital to tax compliance activities and away from production of goods and services that people value. D) All of the above answers are correct because all support the proposition that society should accept some income inequality.
Special interest group K receives a 1/1,000th slice of the economic pie. Its net benefit from either an economic growth policy or a transfer policy is $200,000. In order for group K to be indifferent between the two policies, the economic growth policy would have to make the size of the economic pie (Real GDP) grow by _________________. This type of analysis is used to show that special interest groups tend to press government for ______________ instead of ________________.
A. $200,000,000; economic growth; transfers B. $20,000,000; economic growth; transfers C. $200,000,000; transfers; economic growth D. $20,000,000; transfers; economic growth E. none of the above