Refer to Figure 7.1. Start from initial equilibrium. If firms increase their capital stock, the new real wage could be ________ and the new amount of labor employed could be ________
A) X; A B) Z; A C) X; C D) Z; C
D
You might also like to view...
The economic problem is essentially one of deciding how to make the best use of
A. limited resources to satisfy limited wants. B. unlimited resources to satisfy limited wants. C. limited resources to satisfy unlimited wants. D. unlimited resources to satisfy unlimited wants.
For a normal good, the income elasticity of demand is:
A) positive or negative depending on the share of income accounted for by the good. B) always equal to 1. C) positive if income increases and negative when income declines. D) always positive.
Firms that emit toxins into the air:
a. underproduce because the private cost of production exceeds the social cost. b. overproduce because the social cost of production exceeds the private cost. c. produce the same as nonpolluting firms. d. produce at the socially optimal amount.
When the production possibilities curve has shifted outward, what has happened?
a. Efficiency has dropped significantly. b. Workers are being underutilized. c. Scarcity has increased. d. Factors of production have changed.