Suppose that the state of California imposes a minimum wage of $7 per hour. In the entry-level labor market in California fast-food restaurants, the quantity of labor demanded at $7 per hour is 800 thousand, and the quantity of labor supplied is 1.2 million. Which of the following is true?
a. There is a surplus of 1.2 million workers in the labor market.
b. There is a surplus of 400 thousand workers in the labor market.
c. There is a shortage of 400 thousand workers in the labor market.
d. There is a shortage of 800 thousand workers in the labor market.
b
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If an increase in the price of Good A causes a decrease in demand for Good B, Goods A and B are said to be complements
a. True b. False Indicate whether the statement is true or false
Exhibit 7-15 Long-run average cost
If the firm represented in Exhibit 7-15 is operating with a plant whose size corresponds to short-run average total cost curve A, the level of output that would minimize its short-run average total cost is:
A. 500 units per week. B. 1,000 units per week. C. 1,500 units per week. D. 2,000 units per week.