Which of the following is (are) linked to (an) adverse supply shock(s)?
A) the terrorist attacks of 2001
B) collective bargaining that followed the termination of U.S. wage and price controls in 1973
C) the corporate scandals of 2002
D) all of the above
E) none of the above
B
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Refer to Table 4-8. If a minimum wage of $10.50 an hour is mandated, what is the quantity of labor demanded?
A) 400,000 B) 370,000 C) 340,000 D) 60,000
A student makes the following argument: "When a market is in equilibrium, there is no consumer surplus. We know this because in equilibrium, the market prices is equal to the price consumers are willing to pay for the good. Briefly explain whether you agree with the student's argument.
In the insurance market, "moral hazard" refers to the problem that
A) insurers can't tell high-risk customers from low-risk customers. B) high-risk customers have an incentive to give false signals to make themselves look like low-risk customers. C) companies may unfairly lump individuals together by race, sex, age or other characteristics in an attempt to use demographic data to pinpoint high-risk populations. D) individuals are willing and able to pay different amounts for insurance, but must all be charged the same amount. E) individuals may change their behavior after the insurance is bought, so that they behave in a more high-risk manner than they did before.
When a transfer price is decreased
a. the buying division will chose to purchase less from the selling division b. the buying division will chose to purchase more from the selling division c. the selling division will chose to purchase less from the buying division d. the selling division will chose to purchase more from the buying division