Market Failure and the Role of Government

Number of vacation days offered

Size of business

Geographic location of company offices

Time spent commuting

It increases income taxes significantly

It reduces social well-being

It has no effect on social well-being

It enhances social well-being

Equalization of wages across skilled and unskilled jobs due to diminished incentives for skills acquisition.

A decrease in overall consumer spending due to businesses passing on labor cost increases through higher pricing.

Unemployment among unskilled workers may rise as employers cannot afford or are unwilling to hire at higher wage rates.

Increased employment among unskilled workers as improved wages boost morale and employee retention.

The time spent studying for the exam.

The wages they would have earned at their part-time job.

The grades they receive on the AP Microeconomics exam.

The experience they could have gained at another activity.

Average cost

Price elasticity

Marginal utility

Total revenue

It would increase income inequality by creating higher unemployment among low-wage workers.

It would increase income equality by incentivizing skill development among low-wage workers.

It would have no effect on income inequality as the market adjusts to the new equilibrium wage.

It would decrease income inequality by increasing earnings for low-wage workers.

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-1

1

0

Collusion between oligopolistic firms may lead to higher prices and lower quantity supplied, resulting in decreased consumer surplus and increased deadweight loss.

Collusive behavior among oligopolists is expected to increase overall social welfare by stabilizing prices and reducing uncertainty for consumers and producers alike.

Firms choosing collusion will incur less profits over time as such agreements are difficult to maintain due to cheating incentives.

Oligopolies that collude will eventually become perfect competitors as the market forces them to adopt more efficient production methods.

Increased competition spurs innovation and efficiency gains, narrowing the gap in living standards.

Lower priced imports may put downward pressure on domestic producers' profits, possibly worsening employment conditions and existing disparities.

Consumers face limited choices and inflated prices as a result of anticompetitive practices.

Protectionist measures are quickly enacted, ensuring stability and preservation of the current status quo.

Disincentivizing high earners which may lead to reduced economic growth and innovation.

Incremental revenue for public goods provision improving overall social welfare.

Reducing after-tax income variance thus lowering the Gini coefficient for inequality measurement.

Encouraging labor supply among low-income households by reducing marginal tax rates on them.