The shortened work week coupled with rising hourly wages in the U.S. economy shows that
a. the income effect has been dominant.
b. the substitution effect does not exist at all.
c. the U.S. worker is no longer productive.
d. workers have become increasingly lazy.
a
You might also like to view...
Figure 7-4
Following a rash of airplane bombs, the airlines have been forced to increase security at a cost of $30 million per year. The number of inspectors and machines does not vary with the number of passengers; the airlines must have sufficient staff available to handle the full-capacity load. Which graph in Figure 7-4 best illustrates the impact of the security expenditures?
A. 1 B. 2 C. 3 D. 4
Rising government expenditure, through its effect on the real interest rate, ________ v* and thus ________ net investment
A) raises, stimulates B) raises, depresses C) lowers, stimulates D) lowers, depresses
In a competitive market, a negative externality creates a deadweight loss because
A) the cost of the externality is double counted. B) a harm is generated. C) price equals social marginal cost. D) price equals private marginal cost.
If marginal revenue equals marginal cost, the firm is maximizing profits as long as
A) the resulting profits are positive. B) marginal cost exceeds marginal revenue for greater levels of output. C) the average cost curve lies above the demand curve. D) All of the above are required.