The table shows the demand and supply schedules for student workers at on-campus venues. If the college introduces a strictly enforced minimum wage of $11.50 an hour,
who gains and who loses from the minimum wage, and is the campus labor market efficient or fair?
The workers who retain their jobs and are paid the higher wage rate gain from the minimum wage. The employer, the workers who lose their job, and workers who must undertake extensive search for a job lose from the minimum wage. The minimum wage of $11.50 an hour is not ef-ficient. There is a surplus of workers and the marginal benefit to firms ex-ceeds the marginal cost to workers. A deadweight loss is created. The minimum wage is unfair under the "fair results" approach because some student workers lose their jobs. The minimum wage is unfair under the "fair rules" approach because it blocks voluntary exchange.
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Anjelica expects that her recent fatigue is being caused by pollution being dumped into a local stream by a factory in her community, and she wants to fix this problem
Briefly explain the transactions costs Anjelica is likely to experience in her quest to clean up the stream.
In most societies, resources are allocated by
a. a single central planner. b. a small number of central planners. c. those firms that use resources to provide goods and services. d. the combined actions of millions of households and firms.
Venture capitalists
A. Are a critical link between entrepreneurial ideas and market reality. B. Provide entrepreneurial ideas. C. Share in the risks but not the rewards of entrepreneurial ideas. D. Are always willing to lend money to new businesses.
Refer to the information provided in Figure 5.1 below to answer the question(s) that follow.
Figure 5.1Refer to Figure 5.1. The price elasticity of demand for tickets
A. is equal to zero. B. varies at every point along the demand curve. C. is infinity. D. is equal to 1.