Q1. Assess the given quote from USA Today, March 22, 1988:
‘Increasing the minimum wage would not result in fewer jobs since businesses would absorb the costs as they have absorbed the other costs, according to Robert McGlotten, director of legislation for AFL-CIO’.
'Business does not hire people on the basis of wage,' he states, however on the basis of requirement.'
'If an individual with a specific kind of occupation is required, then that occupation and the skill levels of individuals would be matched with a wage rate,' he states.
And the lost-job claim? McGlotten states critics made that argument when the minimum wage was 25 cents an hour. And 'that's never been true at all’.
Q2. Give detailed answers to each of the given:
a) As a monopolist is the only supplier of the well-defined product, there is no limit to the price it might charge. Is this statement true or false?
b) Describe why a monopolist will never set a price (and produce the subsequent output) at which the demand is price-inelastic.
c) The final monopoly product would be one whose cross elasticity of demand, with respect to any and all other products, was zero. Comment on it.
d) The reason movie theaters charge oldsters and youngsters less than the rest of us are as theater owners want to aid these two low-income groups.