Which of the following is true?
a. If minimum wage is set below the equilibrium wage, it leads to a labor surplus
b. If anything interferes with the voluntary exchanges that make up a market, equilibrium does not occur.
c. Minimum wage helps deal with the problem of unemployment in the market for unskilled labor.
d. Producers are willing to employ more labor at a minimum wage.
e. Minimum wage leads to a situation of labor deficit in a market.
b
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The government of Lithasia has decided to set a minimum price for certain agricultural products in order to safeguard the interests of farmers. This is an example of a ________
A) price floor B) price ceiling C) Pigouvian tax D) Pigouvian subsidy
Which of the following statements CORRECTLY describes the policy stance of a macroeconomist?
A) A monetarist believes that the quantity of money should be constantly changed in order to offset changes in aggregate demand. B) A new classical macroeconomist believes that fiscal and monetary policy are required to maintain full employment. C) A Keynesian believes that if taxes are always kept low and the quantity of money is kept on a steady growth path, no policy actions will be needed to maintain full employment. D) A classical macroeconomist believes that maintaining consistently low taxes will allow the economy to expand at an appropriate and rapid pace.