Above-equilibrium wages caused by efficiency wages will most likely result in
a. a shortage of labor.
b. increased unemployment.
c. compensating wage differentials.
d. an decrease in the quantity of labor supplied.
b
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Of the following industries, which are perfectly competitive? For those that are not perfectly competitive, explain why
a. Restaurants b. Corn c. College education d. Local radio and television
What happens to consumer surplus as price falls along a given demand curve?
a. It always increases. b. It always decreases. c. It never changes. d. It increases only if price increases just a little. e. It depends on the elasticity of demand and supply.
Suppose labor and capital are the only two factors used by a firm to produce pencils. Which of the following statements is true of the average variable costs of this firm?
a. The average variable cost of this firm will be equal to the ratio of the cost of capital and the quantity of output produced by the firm. b. The average variable cost of this firm will be equal to the ratio of the total cost of production and the quantity of output produced by the firm. c. The average variable cost of this firm will be equal to the ratio of wages paid to the workers and the quantity of output produced by the firm. d. The average variable cost of this firm will be equal to the ratio of the quantity of output produced by the firm and the wages paid to the workers.
In this consumer surplus graph, what would happen if the price dropped again the same amount as it dropped between P1 and P2, to a new level, P3?
a. Demand would remain at point C. b. Demand would move to point B. c. Consumer surplus would decrease. d. Consumer surplus would increase.