Why do we say that the demand for labor is a derived demand?
A firm's demand for labor (or for any factor of production) is derived from its decision to supply a good in another market.
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When the supply of a good increases, the quantity supplied at each price is increasing as well
Indicate whether the statement is true or false
An indication to the Open Market Account Manager that commercial banks are experiencing a liquidity shortage would be a
A) falling federal funds rate. B) rising federal funds rate. C) falling discount rate. D) rising discount rate.
Data shows that United States college students purchase more e-books than German college students. Assuming that all students have identical preferences for e-books and textbooks, what is the likely explanation for this result?
A) Taxes on textbooks are higher in the United States than taxes on textbooks in Germany. B) Taxes on textbooks are lower in the United States than taxes on textbooks in Germany. C) The price of textbooks is cheaper in the United States than textbooks in Germany. D) Both A and C.
Using a graph, explain why the law of supply holds for a competitive firm.
What will be an ideal response?