If the Imposition of a Binding Minimum Wage Results in Much

question 122

Multiple Choice

If the imposition of a binding minimum wage results in much higher unemployment among workers seeking minimum wage jobs,

• A)firms will respond by demanding more labor.
• B)those workers who are employed will be worse off than before the minimum wage law.
• C)labor demand is relatively elastic.
• D)labor demand is relatively inelastic.

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Definitions:

Economic Substance

The underlying economic reality of a transaction which determines its legal and tax implications, regardless of its form.

Inventory Value

The total cost assigned to goods and materials held in stock by a business at a specific point in time.

Percentage-Of-Completion

An accounting method used to recognize revenue and expenses of long-term projects proportionally with the degree of completion.

Construction In Progress

An account representing the costs associated with constructing long-term, fixed assets that are not yet completed and ready for use.