An increase in the real wage rate ________ the quantity of labor demanded and ________ the quantity of labor supplied
A) decreases; increases
B) increases; increases
C) decreases; decreases
D) increases; decreases
E) does not change; does not change
A
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A decrease in the personal income tax rate ________ disposable income which ________ consumption
A) increases; increases B) increases; decreases C) decreases; increases D) decreases; decreases
Bob's Lawn Care Services is a perfectly competitive firm that currently mows 22 lawns a week. Bob's marginal cost exceeds the price he charges. Bob can increase his profit if he
A) charges a higher price. B) charges a lower price. C) mows fewer than 22 lawns a week. D) mows more than 22 lawns a week.
An increase in interest rates will cause investment to
A) increase. B) decrease. C) not change. D) move erratically, depending on the interest rate effect on saving.
The relationship between the marginal product of labor (MP), the product price (P) and the marginal revenue product of labor (MRP) in a perfectly competitive market is
a. MP = P x MRP b. MP = P + MRP c. MRP = P / MP d. MRP = P x MP e. MRP = P + MP