Questions 1-4 ask you to consider the effects of immigration on the labor market
ID: 1124827 • Letter: Q
Question
Questions 1-4 ask you to consider the effects of immigration on the labor market. Consider an immigration that is equal to 10 percent of the population in the United States.
1. What would you expect to happen to the equilibrium wage and equilibrium employment in the labor market?
a) Equilibrium wage increases, equilibrium employment increases b) Equilibrium wage decreases, equilibrium employment increases c) Equilibrium wage increases, equilibrium employment decreases d) Equilibrium wage decreases, equilibrium employment decreases
2. Which of the following best describes the effects of the immigration on the welfare of workers that were in the labor market before the immigration occurred?
a) Welfare increases
b) Welfare decreases
c) Welfare stays the same
d) Change in welfare uncertain
3. Which of the following best describes the effects of the immigration on the welfare of the employers in the labor market?
a) Welfare increases
b) Welfare decreases
c) Welfare stays the same
d) Change in welfare uncertain
4. Which of the following best describes the effects of the immigration on the welfare of all those (workers and employers) that were in the labor force before the immigration occurred?
a) Welfare increases
b) Welfare decreases
c) Welfare stays the same
d) Change in welfare uncertain
Explanation / Answer
1. B) equilibrium wage decreases and the equilibrium employment increases
Due to infkux of population in the nation, the wage will decrease as there will be abundant supply of labor and the equilibrium employment will increase.
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