In a perfectly competitive equilibrium with production and trade, which of the following results occur(s)?
A) Pareto-efficiency is obtained.
B) The First Welfare Theorem is satisfied.
C) There is efficiency in production.
D) All of the above.
D
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The entry of China and other developing countries into the global economy ________ the value of marginal product of factory workers in the United States and ________ their wage rate
A) increases; lowers B) decreases; raises C) decreases; lowers D) increases; raises
Assume the supply function for good X can be written as Qs = -100 + 27Px - 5Py - 1.8W where Px = the price of X, Py = the price of good Y, and W = Wage index for workers in industry X
This equation implies that X and Y are substitutes in production. Indicate whether the statement is true or false
Economists call a game that is played more than once:
A. cooperative price play. B. a repeated game. C. collusion. D. a commitment strategy.
Given AD1 and AS1 in Figure 8.3, the classical approach to achieving full employment at an output of $300 billion would be to
A. Increase the growth of the money supply to shift AD1 to AD2. B. Do nothing and wait for "natural" market forces to achieve full employment. C. Increase taxes and increase government spending to shift AD1 to AD2. D. Use all available supply-side options.