Suppose the United Auto Workers' Union succeeded in obtaining a 10 percent increase in the wages of its workers and that the wage increase caused automobile prices to rise. Employment in the auto industry would be most likely to decline significantly if
a. the demand for American-made automobiles was highly elastic.
b. the supply of foreign-produced automobiles was highly inelastic.
c. American consumers considered foreign automobiles a poor substitute for American automobiles.
d. the demand for American automobiles was relatively constant and highly inelastic.
A
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The concept of aggregate supply refers to a
A. fixed number of output. B. list of products demanded. C. schedule of output. D. schedule of production costs.
"A rise in the money supply raised output in the short run, but left output unaffected in the long run." This statement implies that the price level __________ in the long run, causing the interest rate to __________
A) rose; rise B) rose; fall C) fell; rise D) fell; fall
If a bond dealer sells a government bond to the Fed for $100,000, and the reserve ratio is 10 percent, then the bank that receives a $100,000 deposit from the dealer can expand its loans by ________,
and the money supply can increase by as much as ________. A) $80,000; $800,000 B) $10,000; $100,000 C) $90,000; $1,000,000 D) $90,000; $900,000
The town of Marshall's Boy Scout Troop 1099 decreased car parking prices at the Celebrate Marshall Festival and found they made higher profits. This likely occurred because
a. marginal cost was equal to marginal revenue b. marginal revenue was higher than marginal cost c. marginal revenue was less than marginal cost d. demand was inelastic e. marginal revenue was increasing