A person is more likely to increase labor supply in response to an increase in the real wage, the ________ is the income effect and the ________ is the substitution effect
A) larger; larger
B) larger; smaller
C) smaller; larger
D) smaller; smaller
C
You might also like to view...
An increase in a country's capital stock relative to its work force is known as
A) capital improvement. B) capital augmentation. C) capital growth. D) capital deepening.
A rational decision maker takes an action if and only if the marginal benefit exceeds the marginal cost
a. True b. False Indicate whether the statement is true or false
Which of the following is NOT a reason for the inability to stabilize output?
A) lags between observation and action B) policy actions can immediately take effect C) policy constraints D) preference to maintain long-range goals
In response to an unanticipated easing of monetary policy, the price level ________ at first, then ________ after a year.
A. rises; returns most of the way to its original value B. falls; returns most of the way to its original value C. remains roughly unchanged; begins to rise D. remains roughly unchanged; begins to fall