An Increase in the Minimum Wage Is Likely To

question 94

Multiple Choice

An increase in the minimum wage is likely to:

• A) cause unemployment among high-skill workers.
• B) cause unemployment among low-skill workers.
• C) increase the income of labor.
• D) increase on-the-job training opportunities.

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Definitions:

Dictator Game

A psychological and economic experiment where one person (the "dictator") determines how to split an endowment (usually money) between themselves and another participant.

Behavioral Economists

Academics who study the role of psychological, cognitive, emotional, cultural, and social influences on the economic choices of individuals and institutions.

Time Inconsistency

A situation where a person's preferences change over time, leading to decisions that might contradict earlier plans or promises.

Self-Control Problems

Challenges individuals face in resisting short-term temptations in order to achieve long-term goals, often leading to decisions that are not in their best interest.