Over the last decade, a country experiences a significant increase in labor productivity
a. Draw and label a labor market supply and demand diagram. Show how the equilibrium real wage rate and the equilibrium quantity of labor change as productivity increases.
b. Draw and label a production function. Show how potential GDP changes as labor productivity increases.
a. The figure above shows the effect of an increase in productivity in the labor market. The increase in productivity shifts the labor demand curve rightward and, as illustrated, raises the real wage rate and increases the quantity of employment.
b. The production function shifts upward as shown in the figure. Potential GDP increases for two reasons: there is a greater quantity of labor, and the new production function is higher than the old one.
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In the two-period model with asymmetric information, a bank
A) creates money. B) keeps money safely. C) multiplies reserves. D) borrows and lends.
At a price of $5, Sam buys 10 units of a product. When the price increases to $6, Sam buys 8 units. Martha says Sam's demand has decreased. Is Martha correct? a. Yes, Martha is correct. Sam's demand decreased from 10 to 8 units. b. No, Martha is incorrect. Sam's demand increased because price increased from $5to $6
c. No, Martha is incorrect. The quantity demanded decreased from 10 to 8 units but his demand remains unchanged. d. No, Martha is incorrect. The quantity supplied to Sam has decreased from 8 units to 10 units but his demand remains unchanged. e. No, Martha is incorrect. Sam's demand has increased, and his quantity demanded has decreased from 10 units to 8 units.
Which of the following topics is not a part of a typical scenario plan?
a. Expected changes in corporate governance practices. b. Expected changes in labor-management relations. c. Expected changes in government intervention and regulations. d. Expected changes in country infrastructure. e. Expected changes in budgets and capital budgeting projects.
If a country's net exports fall, then its net capital outflow falls by the same amount
a. True b. False Indicate whether the statement is true or false