What would make the demand for labor more elastic?
What will be an ideal response?
The demand for labor will be more elastic the greater the demand for the final product, the easier it is for labor to be substituted for by other inputs, the larger the proportion of total costs accounted for by labor, and the longer the time period.
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Using the Cambridge equation, by how much does the demand for money rise at a constant real GDP of $2,000 billion when the price level rises by 10 percent from 1.00, given k = 0.25?
A) $200 billion B) $20 billion C) $550 billion D) $50 billion
Suppose two duopolists operate at zero marginal cost. The market demand is p = a - bQ. If firm 1 is the Stackelberg leader, what level of output will it choose?
A) q1 = (a - bq2 )/2b B) q1 = (a - 2bq2 )/2b C) q1 = a/b D) q1 = a/2b
The difference between a firm's total revenues and total costs when all explicit and implicit costs are included is the firm's:
a. economic profit. b. accounting profit. c. opportunity cost of capital. d. long-run average total cost.
The term "deadweight loss" or "excess burden" is used to describe the
a. expenditures on exercise and weight-reducing programs by individuals who are overweight. b. loss from the elimination of mutually beneficial exchanges that results from the imposition of a tax in a market. c. difference between the value consumers place on a good and the price they have to pay for it. d. reduction in consumer welfare that occurs when the firms in a market make a profit.