An Increase in Safety Standards Does Not Directly Raise the Wage

question 115

Multiple Choice

An increase in safety standards does not directly raise the wage of employees, however a neoclassical analysis of labour markets suggests it will decrease total employment.What mechanism drives this result?

• A)an increase in safety standards leads to more people wishing to enter the labour force
• B)higher safety costs decrease the value of the marginal product of labour, leading to a downward shift in demand
• C)higher safety costs decrease the value of the marginal product of labour, leading to an upward shift in demand
• D)the labour supply curve shifts inwards in response to safer working conditions

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Definitions:

Expenses

Costs incurred in the process of generating revenue, typically including items like rent, salaries, and utilities.

Source Documents

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Chart of Accounts

An organized list of all the account titles and numbers being used to track financial transactions and prepare financial statements in a company.

Debit Entries

Accounting records that increase expenses or assets, or decrease equity, liabilities, or revenue.