Welfare Reform Will Result in an Influx of a Million

question 3

Multiple Choice

Welfare reform will result in an influx of a million former welfare recipients into the low-wage labor market, which could cause wages to _____.

• A) increase significantly
• B) increase moderately
• C) stay about the same
• D) decrease

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Definitions:

Income Redistribution

The transfer of income from certain individuals or groups to others through mechanisms like taxes, welfare programs, and subsidies, aimed at reducing economic inequality.

Economic Profit

The gap between a company's overall earnings and all its expenses, comprising both direct and indirect costs.

Pure Monopoly

A market structure where a single firm controls the entire supply of a product or service, with no close substitutes.

Barriers to Entry

Obstacles that make it difficult for new competitors to enter a market, such as high startup costs or complex regulations.