In a Perfectly Competitive Economy,workers Are Well-Informed and Firms Can

Multiple Choice

In a perfectly competitive economy,workers are well-informed and firms can monitor workers.Suppose the government then passes a "Worker Privacy Act" that makes it very expensive to monitor workers.Which of the following is most likely to occur?

A) Employment and wages will fall.
B) Employment will fall, but the effect on wages is uncertain.
C) Employment and wages will rise.
D) Wages will rise, but the effect on employment is uncertain.