For a minimum wage to have any impact on a labor market, it must be set at a level
A. Higher than the equilibrium wage.
B. Higher than MPP.
C. Consistent with economic growth.
D. Higher than MRP.
Answer: A
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Figure 11-1
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In Figure 11-1, to reach the level of potential GDP, the administration of President Obama would most likely advocate
A. increasing Social Security payments. B. decreasing defense spending. C. decreasing personal income taxes. D. All of the above are correct.
Nick has two job offers, one as a financial planner and one as an economist for a regional bank. The income that Nick would expect to earn as a financial planner depends how effective he is in getting clients
He estimates that he would receive either $80,000 and a utility of 75, with a probability of .50, or he would earn $30,000 and a utility of 35, with a probability of .50. The economist job would pay $45,000 per year and has a utility of 55. To maximize his expected utility, which job should Nick take? A) Nick is indifferent between the two jobs. B) Nick is better off if he takes the economist job. C) Nick is better off if he takes the job of financial planner. D) Nick should look around for another job.
In which of the following situations would the average standard of living rise?
a. GDP grows at the same rate as population b. GDP grows more slowly than population c. GDP grows faster than population d. GDP per capita remains constant e. GDP grows faster than transfer payments.
This year, Tom sold his 1998 minivan to Honest John's Used Car Emporium for $5,000 . Honest John then sold the van to Bob for $7,000 . How much would be recorded in GDP this year from these transactions?
a. $0 b. $2,000 c. $5,000 d. $7,000 e. $12,000