Suppose the wage rate in a certain industry rises, yet firms hire more workers. The best explanation of this is that labor:
A. demand fell.
B. demand increased.
C. supply fell.
D. supply increased.
Answer: B
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Sue went to the store and milk was on sale so she was able to buy some cookies also. What is this an example of?
a. The Law of Demand b. The Law of Supply c. The Substitution Effect d. The Income Effect
The costs of economic growth include all of the following except consumption sacrificed for:
A. acquiring new human capital. B. research and development into new technologies. C. additional hours of leisure. D. physical capital formation.
The cross-price elasticity of demand for books and magazines is ?2.0. If the price of magazines decreases by 10 percent, the quantity demanded of books will:
A. rise by 20 percent. B. rise by 2.0 percent. C. fall by 20 percent. D. fall by 2.0 percent.
Roxanne and Eileen live in an apartment building with a laundry room in the basement. Roxanne does her laundry at home, spending $4 and 5 hours per week. Eileen sends her laundry out, spending $20 and 15 minutes per week transporting the laundry. On the basis of the information given, which one of the following must be true?
a. Roxanne earns more labor income than Eileen. b. Eileen earns more total income than Roxanne. c. Roxanne enjoys doing laundry; Eileen does not. d. Eileen has less laundry than Roxanne. e. Eileen and Roxanne attach different utilities to time spent doing laundry.