A minimum wage set above the equilibrium wage rate is a price
A) ceiling that results in a shortage of low-skilled labor.
B) ceiling that results in a surplus of low-skilled labor.
C) floor that results in a shortage of low-skilled labor.
D) floor that results in a surplus of low-skilled labor.
D
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A ten percent increase in total factor productivity A will increase ________
A) the marginal product of capital (MPK) by ten percent B) the marginal product of labor (MPL) by ten percent C) output by ten percent D) all of the above E) none of the above
The U.S. economy remains subject to frequent boom and bust cycles. Throughout U.S. history, policymakers after the Great Depression often
(a) raise or lower taxes and spending to adjust aggregate demand and thereby smooth the business cycle. (b) take a hands-off approach to the business cycle. (c) consult with world organizations on how to address cyclic fluctuations. (d) close economies to international trade.
Opening trade between two nations would
a. shift their production possibilities curves outward. b. shift their production possibilities curves inward. c. leave the production possibilities unchanged and increase their consumption possibilities. d. leave the production possibilities unchanged and decreased their consumption possibilities.
Disinflation is like
a. slowing a car down, whereas deflation is like putting the car into reverse gear. b. maintaining a car's speed, whereas deflation is like slowing the car down. c. putting a car into reverse gear, whereas deflation is like slowing the car down. d. maintaining a car's speed, whereas deflation is like putting the car into reverse gear.