Suppose a monopsonist currently employs 100 workers at a wage of $400 per week. If the firm wants to expand employment to 110 workers, and the 110th worker will only work for $450 per week, what is the approximate marginal factor cost of the 110th worker?
a. $450 per week.
b. $5,500 per week.
c. $950 per week.
d. $9,500 per week.
e. $49,500 per week.
c
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Explain the concept of moral hazard. Give an example
What will be an ideal response?
"The minimum wage should be increased so that low-income workers can afford to feed their families." This is an example of: a. a positive economic statement
b. a negative economic statement. c. the fallacy of composition. d. a normative economic statement.
Use the following graph to answer the next question.
A firm that has the long-run cost curves shown in the graph above would not be able to ________.
A. exploit economies of scale B. serve an increasing share of the market at lower and lower unit costs C. attain lower unit costs by reducing its output level D. have an entry barrier protecting it from new entrants into the market
In which of the following scenarios would the income effect be most likely to be greater than the substitution effect?
A. An increase in the minimum wage B. A tax on fast foods C. An increase in salaries for surgeons D. An increase in wages for day laborers