Moving along a bowed-out PPF between milk and cotton, as more ...

[WhattoUnderstand]

Moving along a bowed-out PPF between milk and cotton, as more milk is produced the marginal cost of an additional gallon of milk
 
  A) rises.
  B) does not change.
  C) falls.
  D) probably changes, but in an ambiguous direction.

Question 2

Suppose that the equilibrium wage in the low-skilled labor market is 9.25. Further, suppose the federal government raises the minimum wage to 9.00 an hour from its present level of 8.15.
 
  The government's action of increasing the minimum wage will result in A) a decrease in unemployment.
  B) an increase in unemployment.
  C) a shortage of low-skilled labor.
  D) neither a shortage nor a surplus of labor in the low-skilled labor market.

[Kjones0604]

Answer to Question 1

A

Answer to Question 2

D