Competitive markets tend to ?
Correct answer: C. reduce labour market discrimination because non-discrimination firms will employ cheaper labour earn more profits and drive discriminating firms out of the market
- A. Increase labor market discrimination because some workers can charge more for their services than other workers in a competitive market
- B. have no impact on labour market discrimination
- C. reduce labour market discrimination because non-discrimination firms will employ cheaper labour earn more profits and drive discriminating firms out of the market
- D. increase labour market discrimination because bigoted employers can charge any price they want in a competitive market to cover the cost of their discrimination
Explanation
In competitive labor markets, a non-discriminating firm can hire equally productive workers at lower wages and earn higher profits. Over time, this competitive advantage tends to reduce discrimination by driving discriminatory firms out of the market.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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