Which of the following statements describes the long-run effects of global outsourcing?
A) Wages for U.S. workers will decrease but wages in other countries will increase.
B) Wages in all countries will remain the same as before the outsourcing.
C) Wages and employment will increase globally.
D) Wages will increase globally and employment will stay the same.
C
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A deadweight loss occurs when the market is functioning efficiently
Indicate whether the statement is true or false
When floods wiped out the banana crop in Central America, the equili-brium price of bananas ________ and the equilibrium quantity of bananas ________
A. rose; increased B. rose; decreased C. fell; increased D. fell; decreased
Use the above figure. For this monopolistic competitor, which of the following is INCORRECT?
A) The profit-maximizing rate of output is qe, and the profit-maximizing price is P. B) The demand curve shows a direct relationship between price and quantity demanded. C) The profit-maximizing rate of output is at E, where MR intersects MC. D) A downward sloping marginal revenue curve that is below the demand curve.
The Fed initiates a contractionary monetary policy that is correctly anticipated by economic agents in the economy. The result is
A) decreased prices, but no change in real GDP. B) decreased prices and decreased real GDP in the short run, but only decreased prices in the long run. C) decreased real GDP in the short run and decreased prices in the long run. D) decreased real GDP and prices in both the short run and the long run.