If Firms Are Competitive,under What Circumstances Will Labour-Market Discrimination Exist

question 6

Multiple Choice

If firms are competitive,under what circumstances will labour-market discrimination exist in the long run

• A)It is likely to be nonexistent in the long run since any firms with discriminatory preferences will be driven out of the market.
• B)It is likely to be nonexistent in the long run since workers who receive a wage less than their marginal product will leave the labour market.
• C)It is likely not to be a long-run problem unless customers exhibit discriminatory preferences or government maintains discriminatory policies.
• D)It is likely to be more of a problem in the long run than in the short run due to the zero-profit condition that characterizes long-run equilibrium for competitive firms.

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Definitions:

Redress

The act of correcting a wrong or giving compensation for a harm done.

State of Incorporation

The specific state within the United States in which a company is legally registered to do business.

Statutory Close Corporation Supplement

A legal provision allowing a closely held corporation to operate with less formal procedures than are required of other corporations.

Fewer than 100 Shareholders

A characteristic of some business entities, like S-corporations, which limits the number of shareholders to maintain eligibility for certain tax benefits.