An employer faces a minimum wage control where it cannot pay its workers any less than $10.25 an hour. The employer knows that the workers value the jobs and are willing to work even at much less. The employer decides to offer them the minimum wage, but successfully stops other sellers of work uniform from sell uniforms to its workers so that he can charge more for the ones he sells. This is an
example of
a. Tying
b. Bundling
c. Exclusion
d. Fraud
c
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Suppose you obtain a fixed rate mortgage during a period of relatively high inflation. During the next ten years, inflation falls. Are you a winner or a loser due to inflation? Explain why
What will be an ideal response?
Why do people demand money? Explain the classical and Keynesian views
You have just read that Australia has suffered a drought, destroying its wheat crop for this year. The effect of this adverse supply shock on Australia would probably be
A. an increase in prices, an increase in nominal interest rates, but a decrease in real interest rates. B. a decrease in prices and a decrease in real interest rates. C. an increase in prices and an increase in real interest rates. D. a decrease in prices, a decrease in nominal interest rates, but an increase in real interest rates.
Open, competitive output markets ensure that households do not end up with the wrong goods and services.
Answer the following statement true (T) or false (F)