If labor productivity increases
A) labor costs rise by equal increments.
B) the demand for labor increases.
C) some workers will be laid off.
D) jobs will relocate.
Answer: B
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Whether or not a separating equilibrium exists in a competitive market with adverse selection depends on what fraction of consumers is of the high cost type and what fraction is of the low cost type.
Answer the following statement true (T) or false (F)
Refer to Table 26-5. Suppose the table above illustrates the values of real and potential GDP and the price level if the Fed does not vote to change their current policy to be more contractionary or expansionary
Suppose that the Fed uses an appropriate policy and is successful in keeping real GDP at potential in 2017. State whether each of the following will be higher or lower than if the Fed had taken no action: a. Real GDP b. Potential real GDP c. The price level d. The unemployment rate
Rising prices for a natural resource stimulate
A. the development of complements for the resource. B. the development of substitutes for the resource. C. the development of externalities from the resource. D. the tendency to consume before the resource expires.
Briefly discuss how firms’ investment makes the economy grow.
What will be an ideal response?