If an Increase in the Minimum Wage Increases Workers' Incomes

question 59

Multiple Choice

If an increase in the minimum wage increases workers' incomes by $75 and reduces employers' incomes by $100, while workers' spend all of their income increase but employers reduce their spending by only seventy-five percent of their income reduction, aggregate spending

• A)falls by $5.
• B)falls by $25.
• C)falls by $80.
• D)remains unchanged.

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Definitions:

Adaptation

The process by which organisms adjust to changes in their environment to survive and reproduce, and also a term used in psychology to describe how individuals adjust to new information or experiences.

Permanent Change

An alteration in state or condition that is lasting and does not revert back to its previous state.

Pavlov

A Russian physiologist known for his discovery of classical conditioning during his experiments on the digestive systems of dogs.

Nobel Prize

An international recognition awarded annually in several categories such as Physics, Chemistry, Medicine, Literature, Peace, and Economic Sciences, for outstanding contributions in these fields.