Economists argue competitive markets provide a "natural remedy" to discriminatory wage practices. Which of the following is widely recognized as a potential limit to the effectiveness of that natural remedy?
a. Some workers are members in unions.
b. Some firms pay efficiency wages; others do not.
c. Some customers are discriminatory in their buying habits.
d. Some employees have accumulated more human capital than other employees.
c
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An increase in the minimum wage for unskilled labor tends to
A) generate unemployment among unskilled laborers. B) increase the quantity supplied of unskilled laborers. C) decrease the quantity demanded for unskilled laborers. D) encourage employers to seek substitutes for unskilled labor. E) accomplish all of the above.
Predatory pricing occurs when a firm sells
A) above cost to any customers who have no good alternative. B) above cost to low-income customers who have no good alternative. C) at whatever prices the market will bear. D) below cost in order to eliminate competitors. E) only to customers who agree to rebate a portion of the price.