A firm uses an efficiency wage scheme to deter workers from shirking. A risk-neutral worker will not shirk if
A) the expected loss from being fired is larger than or equal to the gain from shirking.
B) the expected loss from being fired is smaller than the gain from shirking.
C) the gain from shirking is positive.
D) the expected loss from being fired is zero.
A
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President George W. Bush used part of the budget surplus inherited from the Clinton administration to
A) stimulate the economy that was slowing down following the end of the high-tech investment boom. B) fund tax cuts. C) increase government entitlement spending. D) both A and B.
"If I didn't go to class tonight, I would save the $2 campus parking fee and spend three hours at work where I earn $10 per hour." The opportunity cost of attending class this evening is: a. $0
b. $2. c. $30. d. $32.
Foreign exchange reserves are critical to an effective floating exchange rate system
Indicate whether the statement is true or false
Complete crowding out occurs when an increase in government spending is completely offset by an equal increase in tax revenues
Indicate whether the statement is true or false