What is the principal reason that economists give for the existence of deflationary and inflationary gaps?
A. Wages are flexible in the short run.
B. Wages are flexible in the long run.
C. Wages are fixed in the long run.
D. Wages are fixed in the short run.
Answer: D
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In the above table, what is the marginal utility of the second hotdog consumed?
A. 40 B. 10 C. 30 D. 90
When there are fewer substitutes for a product, the ________ for the product is ________.
A. demand; more price elastic B. income elasticity; greater C. income elasticity; smaller D. demand; less price elastic
The demand for oil rig workers off the coast of Louisiana is the same as the demand for oil pipeline workers in North Dakota. The annual earnings of Louisiana oil rig workers is 22% higher than the earnings of North Dakota oil pipeline workers. A possible explanation for this is
A. Louisiana oil rig workers can work only part of the year, but North Dakota oil pipeline workers can work year round. B. being an oil rig worker in Louisiana must be more dangerous than being a pipeline worker in North Dakota. C. the amount of human capital needed to be a pipeline worker must be greater than the amount of human capital necessary to be an oil rig worker. D. Louisiana oil rig workers must face discrimination that is not encountered by North Dakota oil pipeline workers.
Information asymmetries between producers or consumers along with the problems of externalities can:
A. improve free trade. B. always be solved by alternative dispute resolution (ADR) mechanisms. C. cause market failure. D. restrict the use of property rights in a market economy.