Question 17 The following are likely effects created by a Mi

Question 17

The following are likely effects created by a Minimum Wage Regulation, based on the model presented in class, EXCEPT:

Question 17 options:

A. Increase in the number of workers looking for jobs

B. Decrease in the number of jobs available.

C. It will for sure increase wages received by the lowest skilled workers.

D. It will increase the level of Unemployment in the market.

Question 18

The following are correct statements about the cost variables, EXCEPT:

Question 18 options:

A. Variable cost is cost that is affected by the level of total production.

B. Marginal cost is the extra cost incurred when adding one unit of production.

C. Marginal cost is always higher than average variable cost.

D. Fixed cost is the unavoidable cost incurred mainly in the short run, which is also unrelated to how much is produced.

Question 19

The following are correct statements about the cost curves, EXCEPT:

Question 19 options:

A. Average Fixed Cost curve converges to zero as production increases.

B. AVC and ATC curves attain their minimum when they intersect the MC curve.

C. ATC = AVC + MC.

D. MC curves initially decreases and eventually increases.

Question 20

The following are correct statements about Economic Cost and Economic Profits, EXCEPT:

Question 20 options:

A. Economic Cost includes the Opportunity Cost of Inputs that are not reported in Accounting terms.

B. Economic Cost includes the opportunity cost of managerial skills.

C. Economic Profits must be positive in order for producers to be willing to produce.

D. Economic Profits are Zero in the long run under perfect competition.

A. Increase in the number of workers looking for jobs

B. Decrease in the number of jobs available.

C. It will for sure increase wages received by the lowest skilled workers.

D. It will increase the level of Unemployment in the market.

Question 18

The following are correct statements about the cost variables, EXCEPT:

Question 18 options:

	A. Variable cost is cost that is affected by the level of total production.
	B. Marginal cost is the extra cost incurred when adding one unit of production.
	C. Marginal cost is always higher than average variable cost.
	D. Fixed cost is the unavoidable cost incurred mainly in the short run, which is also unrelated to how much is produced.

Question 17

D. Minimum wage may not lead increase in unemployment. Businesses can benefit due to lower employee turnover and other positive effects.

Question 18

C. The MC in the short run will first decline than increase. It will intersect the AVC at the lowest point. MC above AVC is the firm\'s supply curve.

Question 19

C. ATC is the sum of AFC and AVC. MC is the additional cost incurred due to the production of an additional unit.

Question 20

C. Competitve firm\'s earn only zero or normal profit in the long run. The price equals AC.