Wage Determination and Labour Market Intervention
65 questions· page 1 of 7
With the help of a diagram, evaluate the consequences of imposing an effective minimum wage on the employment level and the wage level in a monopsony labour market.
With the help of a diagram, assess whether the impact of an increase in labour productivity on the wages and employment of a firm is likely to be greater in a perfectly competitive labour market than in an imperfectly competitive labour market.
Evaluate whether the marginal revenue product theory (MRP) always explains the differences in wages.
The average wage of chief executives in large companies in a country is over 100 times greater than the average wage of their employees.
Assess how economic theory can account for this variation in average wages.
With the help of a diagram, assess the importance of the supply of labour in relation to the wage and employment levels for firms operating in perfectly competitive and monopsony labour markets.
The introduction of a trade union into a perfectly competitive labour market will always lead to higher wage levels and a higher level of unemployment.
With the help of a diagram, evaluate this statement.
Wages in a perfectly competitive labour market will always be higher than wages in a monopsony labour market.
With the help of a diagram, evaluate this statement.
A profit maximising firm operating in a perfectly competitive labour market might decide to increase the number of workers it employs but it will not choose to increase its workers’ wage rates.
Discuss the extent to which you agree with this statement.
The government of a country sets an effective national minimum wage for workers.
Discuss the arguments for and against the government’s decision.
Discuss the costs and benefits of a trade union intervening to influence the wages of workers in a specific occupation.
The introduction of a national minimum wage will always benefit employees at the expense of employers.
Discuss the extent to which you agree with this statement.
The best outcome for labour markets is that the forces of supply and demand are left to determine wages without government interference.
Discuss with the use of diagrams, whether this statement is always true.