Question 1

Suppose that after the introduction of an environmental regulation the firm is required to hire one extra worker for each worker that is producing output. The introduction of this regulation

A. rotates the cost line upwards

B. rotates the production function upwards

C. rotates the production function downwards

D. rotates the cost line downwards

Question 2

The introduction of a tax in which the firm needs to paytunits of consumption goods to the government

A. has no effect on the labor demand curve

B. shifts the labor demand curve upwards

C. shifts the labor demand curve downwards

D. increase the slope of the labor demand curve