New Jersey raises its minimum wage while neighboring state Pennsylvania, does not. Economists compared the labor market in both states to draw conclusions about the effect of a minimum wage on employment and wages. This is an example of:
A. an economic principle.
B. the economic decision rule.
C. simulation economics.
D. a natural experiment.
Answer: D
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George spent $20,000 to buy bonds issued by a public sector enterprise. According to a stockbroker, the amount spent by George is: a. saving
b. an investment. c. a tax to the government. d. a consumption expenditure.
A reduction in current consumption to pay for the investment in capital intended to increase future production is known as the:
A. investment trade-off. B. consumption effect. C. substitution effect. D. income effect.
When a good is put onto the global market at a price below the cost to produce it, this is known as
A) the infant-industry argument. B) dumping. C) a quota. D) protection of domestic jobs.
Compared to perfect competition, the consumer surplus in a monopoly
A) is unchanged because price and output are the same. B) is lower because price is higher and output is lower. C) is higher because price is higher and output is the same. D) is eliminated.