State the law of supply and explain it
What will be an ideal response?
The law of supply indicates the direct or positive relationship between price and quantity supplied. This law states that when the price of a good increases, sellers will make more of that good available for a specified period of time, other things being equal. Other things being equal, a higher price gives producers more incentive to produce and sell more of that product. Conversely, when the price of a good decreases, sellers will make less of that good available for a specified time period.
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Total revenues
A) are defined as the quantity sold divided by price. B) are not the same as total receipts from the sale of output. C) equal gross revenues minus all expenses of the firm. D) equal the price per unit times the total quantity sold.
The classical model's theory of the interest rate does not apply in the short run
a. True b. False
Suppose that the market for labor is initially in equilibrium. A decrease in the price of output will cause the equilibrium wage
a. and the equilibrium quantity of labor to rise. b. and the equilibrium quantity of labor to fall. c. to rise and the equilibrium quantity of labor to fall. d. to fall and the equilibrium quantity of labor to rise.
?The difference between the LPM model and the logit and probit models is that:
A. ?the LPM assumes constant marginal effects for all the independent variables, while the logit and probit models imply diminishing magnitudes of the partial effects. B. ?the LPM assumes constant marginal effects for some of the independent variables, while the logit and probit models imply diminishing magnitudes of the partial effects. C. ?the LPM assumes constant marginal effects for the dependent variable, while the logit and probit models imply diminishing magnitudes of the partial effects. D. ?the LPM assumes different marginal effects for all independent variables, while the logit and probit models imply diminishing magnitudes of the marginal effects.