Under what conditions could minimum wage laws lead to increases in unemployment?
Minimum wage legislation sets a price floor above the market-clearing equilibrium wage. At that price
floor, buyers (firms) are willing to buy less labor than suppliers (workers) are willing to supply. This
situation will produce an excess supply, with the extent of the excess supply depending upon the demand
and supply elasticities in the labor market. The existence of an excess supply means that there is
unemployment. Many economists contend that this excess supply is rather minimal. Other economists
disagree.
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Kevin owns a personal training gymnasium in Orlando. The above figure shows the demand and cost curves for his firm, which competes in a monopolistically competitive market. Kevin will train how many clients per day?
A) 4 B) 6 C) 10 D) between 2 and 4 E) None of the above answers is correct.
All of the following utility functions rank bundles (q1,q2 ) in the same order except for which one?
A) q11/2 + q21/2 B) q11/2 q21/2 C) ln(q1 ) + ln(q2 ) D) All of the above rank bundles (q1,q2 ) in the same order
The money demand curve will shift to the left if:
A. real income decreases. B. the price level increases. C. the nominal interest rate decreases. D. the nominal interest rate increases.
The trade balance is:
A. exports less imports. B. sum of imports and exports. C. imports less exports. D. total trade this year less total trade last year.