Which of the following government policies would fail to lower the unemployment rate ?
Correct answer: E. Raising the minimum wage
- A. Establishing worker training Programs
- B. Establishing right-to-work laws
- C. Reducing unemployment benefits
- D. Establishing employment agencies
- E. Raising the minimum wage
Explanation
A binding minimum wage raises labour costs and can reduce the quantity of labour demanded, increasing unemployment among affected workers. Training, employment agencies and lower unemployment benefits are generally intended to reduce unemployment, though their effects can vary.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Microeconomics
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.
Practise Microeconomics
1,742 free Microeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Microeconomics questions
Which of the following is an example of a reason why firms might pay efficiency wages ?
Union might increase efficiency in the case Where they ?
Unions tend to increase the disparity in pay between insiders and outsiders by ?
If, for any reason the wage is held above the competitive equilibrium wage?
A minimum wage law tends to ?
Occupational immobility of labour occurs if ?