The equilibrium effects of a temporary increase in total factor productivity include
A) an increase in the real wage and an increase in the real interest rate.
B) an increase in the real wage and a decrease in the real interest rate.
C) a decrease in the real wage and an increase in the real interest rate.
D) a decrease in the real wage and a decrease in the real interest rate.
B
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_____ is the resource whose productivity is most commonly measured
a. Labor b. Capital c. Land d. Energy e. Money
The problem of scarcity: a. exists because resources are limited relative to wants
b. exists because resources are unlimited relative to wants. c. can be eliminated through appropriate government intervention into markets. d. does not exist in communist societies.
Which of the following is a major disadvantage of setting the price of a good below equilibrium and using waiting in line rather than price to ration the good?
a. Compared to price rationing, waiting in line is unfair since it is easier for those with higher incomes to wait in line. b. Waiting in line imposes a cost on the consumer; paying higher prices does not. c. Both waiting in line and higher prices are costly to consumers, but unlike the payment of a higher price, waiting in line does not provide suppliers with an incentive to expand future output. d. Waiting in line benefits consumers at the expense of producers.
Refer to Figure 35.3 for the production possibilities curves for the United States and Mexico. These two curves indicate that
A. There is no benefit to the United States as a result of trading tomatoes or machinery with Mexico. B. Mexico does not have an absolute advantage in the production of either good. C. Mexico has a comparative advantage in the production of tomatoes. D. The United States has a comparative advantage in the production of machinery.