The elasticity of demand for employees is -0.50. It is also estimated that the existing minimum wage (price floor) has increased the raise the wage by 25% above equilibrium wage. How much would the employment change if the price floor was eliminated?
A) Employment would decrease by 12.5%.
B) Employment would increase by 12.5%.
C) Employment would decrease by 25%.
D) Employment would increase by 25%.
B
Economics
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Refer to Table 13-4. Victoria's profit-maximizing quantity sold (Q) and price (P) are
A) Q = 4; P = $6. B) Q = 5; P = $5. C) Q = 6; P = $4. D) Q = 3; P = $7.
Economics
What are some of the problems with using the leading indicators to forecast recessions? If you were a policymaker, would you rely on them?
What will be an ideal response?
Economics