Employers choose to offer efficiency wages because:
A. it has proven to make workers more productive.
B. they give employees an incentive to work hard to keep their jobs.
C. it will reduce turnover, saving the employer time and money to hire and train new workers.
D. All of these are true.
Answer: D
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Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as 
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting upward C. Short-run aggregate supply shifting downward D. Aggregate demand shifting leftward
In a free market there are significant restrictions on how a good or service can be produced or sold
Indicate whether the statement is true or false
It is possible for a firm to enjoy a short-run producer surplus, while at the same time suffering a short-run economic loss
a. True b. False
After the terrorist attacks on September 11, 2001, the United States began devoting substantial resources toward the War on Terrorism, homeland security, and relief efforts. As long as our resources were being used efficiently, the production possibilities curve would suggest that:
A. we will have to give up the production of other goods that could have been produced with these resources. B. we will be able to produce the same amount of other goods as before. C. the military spending will result in an outward shift in the production possibilities curve but that the relief effort will result in an offsetting inward shift. D. we will be unable to devote the resources necessary toward these efforts unless there is an improvement in technology.