Examine the reasons employment levels remained relatively low after the Great Recession.
What will be an ideal response?
The first reason is a higher federal minimum wage. In July of 2009 the Federal minimum wage increased from $6.55 to $7.25. A higher minimum wage means the quantity of labor hours demand by employers decreases. The second possible reason employment did not recover as quickly is due to lower unemployment benefits. In November of 2009 Congress extended the maximum period an unemployed worker could collect unemployment from 26 weeks to 99 weeks. Structural adjustments are another reason for the slow employment recovery. Workers who were employed in the hardest hit areas needed to find new careers. For example, the housing bubble caused many construction workers to lose their jobs. It will take time for these workers to acquire new skills to meet the markets demand. The final reason economists give for the slow recovery is the higher labor costs. The healthcare reform law, specifically the increase in Medicare payroll taxes and the mandatory health insurance coverage (for firms with more than 50 full-time employees) discouraged employers from hiring new or previously-employed workers.
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Foreign outsourcing of service is commonly seen in economies that possess the skills and equipment required to produce those services for themselves
Indicate whether the statement is true or false
Suppose there are only two goods, food and clothing, with food measured on the vertical axis. If the price of clothing changes, holding all else constant,
a. the budget line undergoes a parallel shift to the right b. the budget line undergoes a parallel shift to the left c. a new point of utility maximization will be reached d. the budget line becomes flatter e. the slope of the budget line remains constant