Minimum wage laws:
A) can cause the quantity demanded to exceed the quantity supplied of labor.
B) are used to solve the problem of wage rigidity.
C) can give rise to wage rigidity.
D) help in equating the quantity of labor demanded and supplied.
C
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Patrick lives near two gas stations, Exxon and Shell. If Exxon decreases the price of gas, we predict that the quantity of gasoline demanded at Shell will
A) decrease because Exxon and Shell gas are complements. B) decrease because Exxon and Shell gas are substitutes. C) increase because Exxon and Shell gas are substitutes. D) increase because Exxon and Shell gas are complements. E) not change Exxon and Shell are different brands of gasoline.
A worldwide hops (a flowers used in brewing) shortage made stouts, ales and other specialty microbrews more pricy in 2008. Gayle Goshie, a hops farmer, blames overproduction for hops' previously cheap place on the agricultural market
The glut pushed many hop farmers out business, which gradually helped hop prices recover. Suppose farming hops is a perfectly competitive market. Why would some hop farmers go out of business? A) because the price of hops was below the minimum of average fixed cost B) because the price of hops was lower than the minimum of average variable cost C) because the price of hops was higher than the minimum of average variable cost D) because the price of hops was lower than the minimum of average total cost