Labor unions are restrained in their wage demands because
A. most unions deal with employers who have superior bargaining power.
B. marginal wage cost curves lie above labor supply curves in most labor markets.
C. legislation limits annual increases in nominal wages to 6%.
D. the labor demand curve is downward-sloping.
Answer: D
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When output is below potential and the policy rate has hit the floor of zero, if policymakers do nothing, output will ________ and inflation will ________
A) rise; fall B) fall; fall C) fall; rise D) rise; rise
In a market economy, which of the following would most likely cause a prolonged grain surplus?
a. a decrease in the demand for grain b. an increase in the supply of grain c. imposition of a price floor above the equilibrium price of grain d. imposition of a price ceiling below the equilibrium price of grain
Which of the following is the basic measure of a nation's economic growth rate?
(A) Nonmarket activities over a given period of time. (B) Percentage change of real GDP over a given period of time. (C) Standard of living over a given period of time. (D) Leading indicators over a given period of time.
If legally owning a business can spur growth, why don't all business owners legalize their businesses?
A. Business owners don't care about economic growth. B. Legally owning a business opens new avenues for obtaining loans. C. Excessive regulations often make running a legalized business more cumbersome. D. Legalizing a business has no impact on business practices, so why do it?