If you negotiated a salary based on an anticipated inflation rate of 4 percent, and the actual inflation rate turned out to be 6 percent
A) your employer would have gained at your expense.
B) your real wage will increase, but your nominal wage will decrease.
C) the purchasing power of your wages will not change, since purchasing power is based on your nominal wage.
D) the purchasing power of your real wages would be more than you anticipated.
A
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The conclusion that the economy has price flexibility, wage flexibility, and perfectly competitive markets justifies
A) rational policy making. B) passive policy making. C) active policy making. D) none of the above.
Excise taxes are designed to ______.
a. tax all products equally b. tax distinct products only c. help low-wage earners invest more d. help low-wage earners afford necessities
Which of the following is NOT a type of externality?
A. Negative externality B. Positive externality C. Market externality D. Network externality
An electronics manufacturer can produce either MP3 players or cell phones. As the result of a decrease in the price of cell phones, the firm produces more MP3 players and fewer cell phones. An economist would explain this by saying
A. the supply of cell phones increased and the quantity supplied of MP3 players decreased. B. there has been a decrease in the quantity supplied of cell phones and an increase in the supply of MP3 players. C. there has been an increase in the quantity supplied of cell phones and a decrease in the quantity supplied of MP3 players. D. the supply of cell phones increased and the supply of MP3 players decreased.