Discussions in recent years about the vulnerability of the Social Security System cause some people to feel the payments promised will not materialize. Discuss the possible changes we might observe now.
What will be an ideal response?
If people working now begin to question the viability of Social Security and yet if they want to retire at the planned age and keep their lifestyle during retirement, they will have to increase saving now. The idea is that people will need to build a larger fund at the time of retirement and to do this will require they decrease their current consumption. If people do not alter their saving, they either believe that Social Security will honor their payments and/or they plan on reducing their consumption during retirement.
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A monopolistically competitive firm is like a perfectly competitive firm insofar as both
A) have negatively sloping demand curves. B) can make zero economic profit in the long run. C) have horizontal MR curves. D) are protected by high barriers to entry.
If a good is scarce, does that imply that there is a shortage of it?
What will be an ideal response?
The marginal product of labor (MPL) measures ________
A) by how much labor increases for each additional unit of output B) by how much labor increases for each additional unit of capital C) by how much total factor productivity increases for each additional unit of labor D) by how much labor increases for each additional unit of productivity E) by how much output increases for each additional unit of labor
Last month, sellers of good Y took in $100 in total revenue on sales of 50 units of good Y. This month sellers of good Y raised their price and took in $120 in total revenue on sales of 40 units of good Y. At the same time, the price of good X stayed the same, but sales of good X increased from 20 units to 40 units. We can conclude that goods X and Y are
a. substitutes, and have a cross-price elasticity of 0.60. b. complements, and have a cross-price elasticity of -0.60. c. substitutes, and have a cross-price elasticity of 1.67. d. complements, and have a cross-price elasticity of -1.67.