The figure above shows the demand for and supply of labor of students in Smallville. If the minimum wage is set at $6 per hour, how many hours of students' labor are unemployed?
A) 12,000 hours
B) 9,000 hours
C) 6,000 hours
D) 0 hours
D
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Suppose that a regulatory agency helps producers maximize economic profit. This type of regulation coincides with
A) a natural monopoly. B) a marginal cost pricing rule. C) an average cost pricing rule. D) the capture theory of regulation. E) the social interest theory of regulation.
In the long run, wages and prices are considered to be: a. fixed
b. sticky. c. flexible. d. unstable.
Suppose the same basket of goods costs $200 in the U.S. and 100 pounds in Britain and that the exchange rate is $3 per pound. According to purchasing power parity, if the two countries' price levels do not change, what will happen to exchange rate?
a. The pound would appreciate until the exchange rate reaches $3 per pound. b. The pound would depreciate until the exchange rate reaches $2 per pound. c. The pound would depreciate until the exchange rate reaches $0.50 per pound. d. The dollar price of a pound would remain at $10. e. The pound would appreciate until the exchange rate reaches $4 per pound.
During a financial crisis the possibility of bank failures rises. An increase in the likelihood of a bank failing shifts demand for its stock
a. right, so the price rises. b. right, so the price falls. c. left, so the price rises. d. left, so the price falls.