If Labor Markets Are Competitive, Discriminating Employers

question 1

Multiple Choice

If labor markets are competitive, discriminating employers

• A)will have to pay higher wages since the available labor supply is smaller.
• B)will have higher costs and therefore be at a competitive disadvantage.
• C)will be driven out of business by nondiscriminators.
• D)All of the above are true.

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Definitions:

Economic Inefficiency

A situation where resources are not allocated optimally, leading to waste or loss in the potential value of output.

Hollow Corporation

A business model where a company outsources most of its production processes, keeping only core functions such as design, marketing, and branding in-house.

Imports Foreign Goods

The act of bringing goods and services from foreign countries into one's own country for sale.

Trade Deficit

A situation where a country's imports exceed its exports, indicating that it is buying more from other countries than it is selling to them.