In What Way Do Competitive Markets Have a "Natural Remedy

question 377

Multiple Choice

In what way do competitive markets have a "natural remedy" for discriminatory hiring practices?

• A)Governments regulate to resolve problems of discrimination.
• B)Profit-maximizing firms that do not discriminate tend to replace firms that discriminate.
• C)Wages paid to groups that are victimized by discrimination are eventually bid up to above-equilibrium levels.
• D)Discrimination is usually the outcome of rational decision-making processes, and competitive markets produce rational outcomes.

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Definitions:

Social Planner

A theoretical figure in economics who makes decisions aimed at achieving the best outcomes for society as a whole, often used in discussions of social welfare and public goods.

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The sum of all earnings received by an individual or entity, including wages, salaries, profits, rental income, investment returns, and other sources.

Political Philosophies

The study of questions about government, politics, liberty, justice, property, rights, law, and the enforcement of a legal code by authority.

Cox and Alm

Researchers known for their work in economics, often studied in the context of tax policies and their economic impacts.