Economists have hypothesized that the widening gap between the wages of unskilled workers and skilled workers may be due to ?
Correct answer: A. decrease in the demand for unskilled workers because of increases in technology and increases in international trade
- A. decrease in the demand for unskilled workers because of increases in technology and increases in international trade
- B. increase in the number of unskilled workers available due to immigration into the UK.
- C. decrease in the demand for unskilled workers are more poorly educated
- D. increase in the number of unskilled workers available because workers are more poorly educated
Explanation
Skill-biased technological change and international trade can reduce demand for unskilled labour relative to skilled labour, widening the wage gap. The other choices are poorly worded or do not state the standard explanation as clearly.
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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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