If Minimum Wage Legislation Does Cause Unemployment, Then

question 48

Multiple Choice

If minimum wage legislation does cause unemployment, then:

• A) those who are lucky enough to land jobs benefit.
• B) those who become unemployed as a result lose.
• C) firms will not bear the entire burden of the higher cost of employment.
• D) All of these are true.

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Definitions:

Economic Activity

entails the production, distribution, and consumption of goods and services in an economy.

Employment

A situation in which an individual has a paid job.

Production

The process of combining various material inputs and immaterial inputs (plans, know-how) in order to make something for consumption (output).

Opportunity Cost

The detriment of neglecting the next optimal alternative during the process of making a decision.