What Is the Effect of Minimum-Wage Laws on Unemployment

question 63

Multiple Choice

What is the effect of minimum-wage laws on unemployment?

• A) Minimum-wage laws are the major cause of natural unemployment.
• B) Minimum-wage laws probably increase teenage unemployment.
• C) Minimum-wage laws mainly affect skilled workers.
• D) Minimum-wage laws have no impact on unemployment.

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Definitions:

Moral Hazard Problem

The risk that one party to a transaction takes on more risk because it knows that the other party bears the consequences of those risks.

High-End

Products or services that are considered to be of the highest quality and typically sold at a premium price.

Signaling

The process through which parties communicate certain attributes or intentions to others, often seen in markets and negotiations.

Reviewers

Individuals or entities that assess the quality, importance, or usefulness of something, often leading to recommendations or evaluations.