Slower growth in labor demand in combination with increases in labor supply explains ________ accompanied by ________.
A. a slowdown in real wage growth; a decline in employment
B. a slowdown in real wage growth; increasing wage inequality
C. accelerated real wage growth; a decline in employment
D. a slowdown in real wage growth; rapid employment growth
Answer: D
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A production possibilities frontier can shift outward for all of the following reasons except one. Which is the exception?
a. a decrease in the unemployment rate b. an improvement in labor skills c. an improvement in technology d. a larger work force e. a larger capital stock
In which of the following regions would you most expect to see labor-intensive production?
a. Japan b. Western Europe c. southeast Asia d. the United States
A firm cannot maintain above-normal profits over the long run
A. Unless predatory pricing occurs. B. Without retaliation occurring. C. Unless barriers to entry exist. D. Without the existence of a cartel.
Most economists believe that the theory of rational expectations is
A. more correct in the long run than the short run. B. more correct in the short run than the long run. C. correct in both the long run and short run. D. incorrect because it is based on false logic.