Consider Two Labor Markets

question 89

Multiple Choice

Consider two labor markets.In the first,the elasticity of supply is relatively elastic,while it is relatively inelastic in the latter.Imposing a minimum wage in each market would result in ________ unemployment in the first market and ________ unemployment in the second.

• A) lower; lower
• B) higher; higher
• C) unchanged; unchanged
• D) lower; higher
• E) higher; lower

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Definitions:

Direct Materials

Raw materials that are directly attributable and allocable to a finished product in the manufacturing process.

Direct Labor-Hours

The total hours worked directly on the manufacturing of goods.

Variable Overhead

Costs that fluctuate with changes in production volume, such as utilities and materials, affecting the cost to produce goods or services.

Direct Materials

The raw materials that are directly traceable to the production of a specific product and constitute a significant portion of the product's direct costs.