Income Effect of Lower Wages Implies

question 69

Multiple Choice

Income effect of lower wages implies

• A)workers prefer leisure to work.
• B)an increase in the productivity of labor.
• C)a fall in the demand for labor.
• D)workers would want to work more.

---

Definitions:

Perfect Competitor

An idealized market structure where many firms sell identical products, and there are no barriers to entering or exiting the market.

Total Profit

The overall financial gain made by a business after subtracting all expenses from the total revenue generated.

Herfindahl-Hirschman Index

A measure used to assess the level of market concentration and competition within an industry, calculated by squaring the market share of each firm competing in the market and then summing the resulting numbers.

Concentration Ratio

A measure of the total market share that is controlled by a specified number of the largest firms in the industry.