When there is a decrease in the price of a good,
A. the elasticity of demand will determine the degree to which quantity demanded falls.
B. the elasticity of demand will determine the degree to which quantity demanded rises.
C. the demand curve will shift to the right.
D. the demand curve will shift to the left.
Answer: A
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The White House's deficit commission has proposed several ways for the government to reduce the federal budget deficit, including freezing salaries of federal workers
Other things equal, freezing salaries of federal workers would tend to ________ the opportunity cost of leisure and ________ the supply of labor. A) increase; increase B) increase; decrease C) decrease; increase D) decrease; decrease
In the short run, the competitive firm will hire more labor if
A) the wage rate increases. B) the price the firm receives for the output increases. C) the price the firm receives for the output decreases. D) a specific tax is imposed on the output.
To an economist, a free rider is a person who
A) uses private goods without paying for them. B) benefits from consuming public goods without paying for them. C) consumes demerit goods. D) uses the public transportation system without paying for it.
Which of the following models has as its central idea that workers and firms have rational expectations?
A) the monetarist model B) the new classical model C) the real business cycle model D) the new Keynesian model