David Card and Alan Krueger conducted a study of fast-food restaurants in New Jersey and Pennsylvania. The study found that
A) there was a large reduction in employment of low-skilled workers when the minimum wage was raised in these states.
B) the earned income tax credit is more effective in raising the incomes of low-skilled workers than increases in the minimum wage.
C) increases in the minimum wage had a very small impact on employment.
D) increases in the prices of food have a greater effect on wage increases in New Jersey than in Pennsylvania.
Answer: C
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Suppose Jordan and Lee are trying to decide what to do on a Friday. Jordan would prefer to see a comedy while Lee would prefer to see a documentary. One documentary and one comedy are showing at the local cinema. The payoffs they receive from seeing the films either together or separately are shown in the payoff matrix below. Both Jordan and Lee know the information contained in the payoff matrix. They purchase their tickets simultaneously, ignorant of the other's choice. 
Suppose a timing element is added to the game, and that Jordan buys a ticket first. Then, after seeing Jordan's choice, Lee buys a ticket. What will be the equilibrium outcome?
A. Both Jordan and Lee will buy a ticket to the documentary. B. Both Jordan and Lee will buy a ticket to the comedy. C. Jordan will buy a ticket to the documentary and Lee will buy a ticket to the comedy. D. Jordan will buy a ticket to the comedy and Lee will buy a ticket to the documentary.
Amy can study for an hour or spend that hour sleeping or going out for dinner. If she decides to study for the hour, the opportunity cost of the hour spent studying is
A) sleeping or going out for dinner, whichever she would have preferred the most. B) definitely going to slee
Unemployment
a. usually decreases whenever nominal GDP decreases. b. usually increases whenever real GDP decreases. c. usually decreases whenever nominal GDP increases. d. usually increases whenever the price level increases.
The ratio at which nations will exchange one product for another is known as the:
A. Exchange rate B. Discount rate C. Terms of trade D. Balance of trade