A Minimum Wage That Is Set Above a Market's Equilibrium

question 214

Multiple Choice

A minimum wage that is set above a market's equilibrium wage will result in

• A) an excess demand for labor, that is, unemployment.
• B) an excess demand for labor, that is, a shortage of workers.
• C) an excess supply of labor, that is, unemployment.
• D) an excess supply of labor, that is, a shortage of workers.

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Definitions:

Cost Flow Assumptions

Accounting methods that determine how costs are assigned to inventory and cost of goods sold, such as FIFO, LIFO, and average cost.

FIFO

An inventory valuation method where the first items produced or purchased are the first sold, leading to inventory being valued at approximate recent costs.

LIFO

An inventory valuation method that assumes the last items added to the inventory are the first ones to be sold ("Last In, First Out").

Weighted Average

A calculation that takes into account the different degrees of importance of the numbers in a dataset, making some values count more heavily than others.