In Countries That Have High Minimum Wages and Require a Lengthy

question 116

Multiple Choice

In countries that have high minimum wages and require a lengthy and costly process to get permission to open a business,

• A)reducing either the minimum wage or the time and cost to open a business would have no effect on the long-run aggregate supply curve.
• B)reducing the minimum wage and the time and cost to open a business would both shift the long-run aggregate supply curve to the right.
• C)reducing the minimum wage would shift long-run aggregate supply to the right.Reducing the time and cost to open a business would have no affect on the long-run aggregate supply curve.
• D)reducing the minimum wage would have no affect on the long-run aggregate supply curve.Reducing the time and cost to open a business would shift the long-run aggregate supply curve to the right.

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Definitions:

Capital Gains

Capital gains are the profit earned from the sale of an asset, such as stocks, bonds, or real estate, which exceeds the purchase price.

Tax Tables

Charts or tables provided by tax authorities that show the amount of tax payable based on income earned, used to calculate tax liabilities.

Shareholders' Wealth

The total value of a company's shares, reflecting the overall financial well-being and investment attractiveness of the company to its shareholders.

Weighted Average Cost of Capital (WACC)

A calculation of a company's cost of capital where each category of capital is proportionally weighted, including equity, debt, and other forms of financing.