An increase in the population and hence the supply of labor causes a
A) shortage of labor at the original real wage rate and the real wage rate will fall.
B) surplus of labor at the original real wage rate and the real wage rate will rise.
C) surplus of labor at the original real wage rate and the real wage rate will fall.
D) shortage of labor at the original real wage rate and the real wage rate will rise.
C
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If the unemployment rate is less than the natural unemployment rate, then
A) there is no frictional unemployment. B) cyclical unemployment is greater than zero. C) real GDP is less than potential GDP. D) real GDP is greater than potential GDP. E) frictional unemployment is negative.
Monetary neutrality refers to the fact that changes in the money supply
A) affect output more in the long run than in the short run. B) have no effect on output in the long run. C) affect only output in the long run. D) have a greater effect on prices in the short run than in the long run.
Suppose agricultural technology results in increased grain yield for U.S. farmers. The increased supply of grain will drive down grain prices. Because the demand for grain is price elastic, lower prices will result in lower total farm revenue
Indicate whether the statement is true or false
Automatic stabilizers are designed to
A. simplify the tax system. B. promote global trade. C. stabilize the bi-partisan budget process. D. moderate changes in disposable income.