A Minimum Wage

question 103

Multiple Choice

A minimum wage

• A)prevents the real wage from increasing to its equilibrium amount.
• B)prevents employment from increasing to its equilibrium level.
• C)cannot have any effect on employment.
• D)prevents employment from declining to its equilibrium level.
• E)guarantees that the labor market will be at equilibrium.

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Definitions:

Balance Sheet

A report that encapsulates a business's assets, debts, and owner's equity at a certain date.

Financial Leverage

The use of borrowed funds with a fixed cost in an effort to amplify the potential return to shareholders.

Bonds Payable

Long-term liabilities represented by documents promising to pay a specified sum of money at a future date plus periodic interest payments to bondholders.

Accounts Payable

Represents the amounts owed by a company to its creditors for goods and services purchased on credit.