The following graph shows the production possibilities curve for the economy with only two members, Silvia and Art. Silvia can produce either 50 pounds of beef or 2 computers per week, and Art can produce 100 pounds of beef or 1 computer per week. Both of them work 40 weeks per year.
With the open trade economy, Silvia and Art can consume any combination of beef and computers from the line
A. XY.
B. PQ.
C. PY.
D. XYZ.
Answer: B
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In a labor market without an efficiency wage, minimum wage, or union wage, when the real wage rate exceeds the equilibrium real wage rate, there is a ________ of labor and the real wage rate will ________
A) surplus; fall B) shortage; fall C) shortage; rise D) surplus; rise E) surplus; not change because only efficiency wages or union wages can change.
Money has replaced the need to barter, which is:
A. something you can directly offer, like any good or service, in exchange for some good or service you want. B. something you can use to purchase goods and services. C. a certain amount of purchasing power that it retains over time. D. a standard unit of comparison.
Suppose a country has 1 billion people. 75 percent of its citizens are in the labor force, with 90 million unemployed. Full employment occurs at 2 percent. Based on this information, what is the unemployment rate?
A. 8.3 percent. B. 12.0 percent. C. 25.0 percent. D. 9.0 percent.
Suppose a person has a discount rate of zero. This implies she
A) places no value on the future. B) places no value on the present. C) values the present and the future equally. D) would not lend money at any positive interest rate.