Consider an economy in which all labor markets are perfectly competitive, all workers are equally able to do any job, and the nonwage attributes of all jobs are equally attractive to all workers. Which of the following would occur in a labor market where the current wage rate exceeds wage rates in alternate markets?
a. Labor demand will decrease, and the equilibrium wage rate will fall.
b. Labor demand will increase, and the equilibrium wage rate will fall.
c. Labor demand will increase, and the equilibrium wage rate will rise.
d. Labor supply will decrease, and the equilibrium wage rate will rise.
e. Labor supply will increase, and the equilibrium wage rate will fall.
E
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Which of the following best describes an oligopoly?
a. A few firms selling all automobiles b. One firm providing all tap water c. A few firms banding together to set gas prices d. Two firms manipulating e-book prices
The share of the burden of an emissions tax on output borne by the consumer of the polluting output will rise as
a. the tax rises. b. demand elasticity falls. c. demand elasticity rises. d. the tax falls.
The federal government subsidizes higher education
A. less than primary and secondary education. B. more than primary and secondary education. C. about the same as primary and secondary education. D. because it does not subsidize primary and secondary education.
A government currently uses price controls to hold down the price of zinc, an exhaustible resource. If price controls are removed,
A. production of zinc will probably fall. B. zinc mines with high marginal cost of production will probably stop producing. C. consumers of zinc will probably want substitutes for zinc. D. income will probably be redistributed from zinc producers to zinc consumers.