If the substitution effect of wage increases is greater than the income effect, then the individual labor supply curve is positively sloped in the short run.
Answer the following statement true (T) or false (F)
True
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Based on the figure below. Starting from long-run equilibrium at point C, an increase in government spending that increases aggregate demand from AD to AD1 will lead to a short-run equilibrium at point ________ creating _____gap. 
A. D; an expansionary B. B; no output C. B; expansionary D. A; a recessionary
Using a graph, show a market equilibrium. Suppose the costs of inputs increase. How is this shown on the graph? Explain what is happening in the market
What will be an ideal response?
Which of the following is not an automatic stabilizer:
a. Business profits taxes. b. Welfare payments. c. Unemployment compensation. d. All of the above are examples of automatic stabilizers.
The income elasticity of demand for ________ goods tends to be positive, while demand for ________ goods tends to be negative
a. normal; inferior b. inferior; normal c. necessary; luxury d. luxury; necessary