When the minimum wage is raised in a competitive market, ceteris paribus,
A. Workers are not affected by a minimum wage increase, only by decreases.
B. All workers are better off.
C. All workers are worse off.
D. Some workers are better off and some are worse off.
Answer: D
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Would the Federal Reserve respond more aggressively with interest rate cuts in a recession caused by a decrease in spending, as in the 2001 recession, than in a recession caused by an increase in oil prices, as in the 1974-75 recession?
What will be an ideal response?
When a jeweler sells a low quality diamond to a young man who believes the diamond is the highest quality, she is engaging in
a. both moral hazard and adverse selection. b. neither moral hazard nor adverse selection. c. moral hazard, but not adverse selection. d. adverse selection, but not moral hazard.
Which of the following are accurate arguments suggesting that the fiscal stimulus did work?
A. Real GDP growth moved from negative to positive in 2009. B. Employment increased in 2009. C. The economy has natural self-correcting mechanisms. D. The return on bailout assets reduced the deficit.
Which group has the highest poverty rate?
A. Non-Hispanic whites B. Blacks C. Hispanics