Suppose the price elasticity of demand for iPods is inelastic. What would you expect about the demand elasticity for workers producing iPods? Explain
What will be an ideal response?
Because the demand for workers producing iPods is derived from the demand for iPods, the demand elasticity for the workers is positively related to the price elasticity of demand for the final products. This means that the demand elasticity for workers producing iPods is also inelastic.
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Answer the following statement(s) true (T) or false (F)
1. Odds are said to be fair if they reflect the true probabilities of the various states of the world. 2. Risk aversion leads individuals to underinvest from a social point of view. 3. To deal with the problem of adverse selection, insurance companies may limit the amount of insurance that can be purchased at the most favorable odds. 4. An insurance company faces an adverse selection problem when people start taking additional risks after they acquire insurance. 5. A nuclear disaster is an uninsurable risk because it would adversely affect a large number of people simultaneously.
An increase in labor supply will cause, other things the same ________
A) real wages and employment to rise B) real wages to fall and employment to rise C) real wages to rise and employment to fall D) real wages and employment to fall
President Trump's proposed increase in spending on infrastructure projects is an example of discretionary fiscal policy aimed at increasing
A) real GDP and employment. B) tax revenues and the federal budget surplus. C) disposable income and interest rates. D) the money supply and money demand.
Which of the following statements is true?
A. The short-run aggregate supply curve is downsloping. B. The short-run aggregate supply curve is vertical. C. The long-run aggregate supply curve is vertical. D. The long-run aggregate supply curve is upsloping.