If Employers Are Provided a Subsidy of $1 Per Hour

question 60

Multiple Choice

If employers are provided a subsidy of $1 per hour for hiring workers,________.

• A) the equilibrium employment will increase
• B) the equilibrium real wage will decrease
• C) labor supply will increase
• D) labor demand will decrease

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Definitions:

Internal Rate

Often refers to the internal rate of return (IRR), which is a discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.

Net Present Value

A financial metric used to evaluate the profitability of an investment, accounting for its time value of money.

Capital Budgeting

The process of planning significant investments in projects that have long-term implications such as the purchase of new equipment or the introduction of a new product.

Screening Tool

A method or instrument used to assess or evaluate certain characteristics in individuals or scenarios, often used in healthcare, employment, and research.