Answer to Question #183618 in Economics for Eza Derick

Question

. Government imposes a minimum wage and some workers threaten to demonstrate.

i. Who are those likely to benefit from the minimum wage (2 marks)

ii. Who are those likely to demonstrate (2 marks)

b. Differentiate between a price ceiling and price floor. (3 marks)

c. Explain the following using the concept of Productions Possibilities Frontier

ii. iii. iv.

d. Explain i.

Unemployment is.Trade off iii.Economic Growth (2 marks) Efficiency (2 marks)

how the following affect the demand for Milo. An increase in the price of Milo (2 marks)

Answer 1

a. If government imposes a minimum wage and some workers threaten to demonstrate.

i. Low-skilled and unskilled workers are likely to benefit from the minimum wage.

ii. High-skilled workers are likely to demonstrate.

b. A price ceiling is set below the equilibrium level and price floor is set above the equilibrium level.

c.

i. Unemployment occurs when some people who are actively searching for employment are unable to find work, and not all labor is used in production.

ii. Trade off is when the use of one resource increases, and the use of another must decrease.

iii. Economic Growth is a shift of PPF to the right.

iv. Efficiency is a peak level of performance that uses the least amount of inputs to achieve the highest amount of output.

d. An increase in the price of Milo will decrease the quantity demanded of Milo, but the demand will not change.