Marginal productivity theory would suggest that
A) all workers should be paid the same wage.
B) higher productivity will increase the market wage of an individual.
C) labor demand will have no impact on the wage paid.
D) workers cannot do anything to improve their wage prospects for the future.
Answer: B
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If the Fed decided to target price levels and inflation was lower than its target for a period of time, the Fed would be required to
A) permanently raise inflation above its target to reach and maintain its price level target. B) permanently lower its price level target to align it with the inflation rate. C) temporarily lower its inflation target to match its price level target. D) temporarily raise inflation above its target to reach its price level target.
Junk bonds are defined as those bonds the rating services consider to be
A) investment grade. B) high risk or speculative grade. C) financial grade. D) in default.
A fall in the price of pesticide use in the production of cotton will
A) decrease the supply of cotton, causing the supply curve of cotton to shift to the left. B) increase the supply of cotton, causing the supply curve of cotton to shift to the left. C) cause a downward movement along the supply curve of cotton. D) have no effect on the supply of cotton. E) None of the above
Refer to the information provided in Figure 28.3 below to answer the question(s) that follow.
Figure 28.3Refer to Figure 28.3. A minimum wage of $10
A. will lead to unemployment of 40. B. will lead to unemployment of 20. C. will lead to unemployment of 60. D. will have no effect because the minimum wage is set at the equilibrium wage and for a minimum wage to have any effect on the labor market it must be below the equilibrium wage.