Most Economists Maintain That the Major Factor Underlying Wage Stagnation

question 13

Multiple Choice

Most economists maintain that the major factor underlying wage stagnation in the United States in the 1990s has been:

• A) Import competition
• B) Technological change
• C) Rising real value of the minimum wage
• D) Increasing union membership

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Definitions:

Monopolistic Competitor

A firm operating in a market structure where many companies sell products that are similar but not identical, allowing for some degree of market power and price setting.

Excess Capacity

A situation in which a company can produce more goods or services than currently demanded, due to underused resources.

Economic Profit

Profit calculated by subtracting both explicit and implicit costs from total revenues, indicating the efficiency beyond the breakeven point.

Capital-Intensive

Describing industries or processes that require a high level of capital investment in machinery and equipment relative to labor.