In the above figure, the monopsonist will employ
A) L2 at a wage of W2.
B) L2 at a wage of W3.
C) L1 at a wage of W1.
D) L1 at a wage of W3.
D
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A store is choosing between advertising a credit card fee or a discount for paying cash to its customers. People will care more about:
A. getting the discount rather than avoiding the fee. B. avoiding the fee rather than getting the discount. C. neither; since it's the same outcome, people won't care one way or another. D. It is impossible to say without more information.
An increase in human capital will decrease output.
Answer the following statement true (T) or false (F)
A budget constraint:
A. shows different bundles of goods that all cost the same amount. B. shows different bundles of goods that all yield the same total utility. C. shows how much income is needed to maximize total utility. D. shows different bundles of goods that all maximize an individual's utility.
When there is a recessionary gap, inflation will ________, in response to which the Federal Reserve will ________ real interest rates, and output will ________.
A. decline; lower; decline B. increase; raise; decline C. decline; lower; expand D. decline; raise; decline