Explain why featherbedding may or may not increase the demand for labor.
What will be an ideal response?
When firms are forced to use more labor per unit of output, their production costs are likely to increase, resulting in higher prices for their products. If consumers respond to higher prices by purchasing noticeably less output, the total employment may actually decrease.
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In December 2009, currency outside of banks was $400 billion, traveler's checks were $5 billion; checkable deposits owned by individuals and businesses were $600 billion, saving deposits were $2,000 billion, time deposits were $1,500 billion; and
money market funds were $1,200 billion. What was the M2 in December 2009? A) M2 = $5,705 billion B) M2 = $3,705 billion C) M2 = $1,005 billion D) M2 = $2,505 billion E) M2 = $5,700 billion
A crucial national income accounting identity sets the government budget deficit equal to
A) S - I - NX. B) S + I - NX. C) S - I + NX. D) S + I + NX.
If a price ceiling is imposed, then:
a. the market supply curve will shift to the right. b. the market demand will shift to the left. c. a shortage of product will result. d. the government would be required to buy-up the surplus product. e. the market equilibrium price is below the level the government wishes to achieve.
Government spending can ____________ certain elements of long-term growth
a. discourage b. negate c. encourage d. compromise