The official measure of unemployment may underestimate actual unemployment because
a. people may lie when reporting they are looking for jobs
b. the treatment of involuntary part-time workers and discouraged workers is misleading
c. the population sample employed by the Labor Department is too small to be representative
d. some individuals who should be receiving unemployment benefits do not receive them
e. individuals who are unable to work are not included
B
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If supply in the market for air filters is specified as QS = 24 + 3P, then, when conventionally graphed,
a. the vertical intercept is +24 b. the slope of the supply curve is +3 c. the horizontal intercept is +3 d. none of the above
Among a set of alternatives with the same total costs, an individual is said to optimize if she chooses an alternative that has the:
A) highest total benefit. B) highest risk. C) lowest opportunity costs. D) highest net costs.
The type of unemployment caused by changes in the business cycle is
What will be an ideal response?
Consider the following entry game: Here, firm B is an existing firm in the market, and firm A is a potential entrant. Firm A must decide whether to enter the market (play "enter") or stay out of the market (play "not enter"). If firm A decides to enter the market, firm B must decide whether to engage in a price war (play "hard"), or not (play "soft"). By playing "hard," firm B ensures that firm A makes a loss of $2 million, but firm B only makes $2 million in profits. On the other hand, if firm B plays "soft," the new entrant takes half of the market, and each firm earns profits of $4 million. If firm A stays out, it earns zero while firm B earns $8 million. Which of the following are perfect equilibrium strategies?
A. (enter, soft) B. (not enter, hard) C. (enter, hard) D. (not enter, soft)