The elasticity of labor supply measures the
A. Magnitude of the substitution effect of labor.
B. Responsiveness of the wage rate to changes in the labor supplied.
C. Responsiveness of labor supplied to changes in the wage rate.
D. Opportunity cost of labor.
Answer: C
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Suppose two companies, Macrosoft and Apricot, and considering whether to develop a new product, a touch-screen t-shirt. The payoffs to each of developing a touch-screen t-shirt depend upon the actions of the other, as shown in the payoff matrix below (the payoffs are given in millions of dollars). 
Suppose Apricot makes its decision first, and then Macrosoft makes its decision after seeing Apricot's choice. What will happen if, before Apricot chooses, Macrosoft announces that it is going to develop a touch-screen t-shirt no matter what Apricot does?
A. Neither Apricot nor Macrosoft will develop a touch-screen t-shirt because they will both realize that they are in a no-win situation. B. Apricot will develop a touch-screen t-shirt, and Macrosoft will not because Macrosoft's threat is not credible. C. Macrosoft will develop a touch-screen t-shirt, and Apricot will not because it's not in Apricot's interest to develop a touch-screen t-shirt if Macrosoft also develops one. D. Both Apricot and Macrosoft will develop a touch-screen t-shirt because neither company will want to back down.
On December 16, 2008, the FOMC announced it would lower its target for the federal funds rate to between ________ and ________?
a. 0 ; .50 b. 1; 1.85 c. 0; .25 d. 1; 2
Reducing involuntary unemployment:
a) Helps the economy move on to the Production Possibility Frontier b) Helps shift the economy's Production Possibility Frontier inwards c) Helps the economy move along its Production Possibility Frontier d) Helps the economy move inside the Production Possibility Frontier
From the early 1980s through 2000, the Federal Reserve's primary focus was on
A. controlled inflation and stable growth. B. ensuring rapid growth. C. stable employment through monetary expansion. D. keeping gold prices stable.