Define the following: market equilibrium, surplus, and shortage
What will be an ideal response?
When a market is in equilibrium, quantity supplied is equal to quantity demanded. If quantity supplied is greater than quantity demanded, there is a surplus. If quantity demanded is greater than quantity supplied, there is a shortage.
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Who loses and who gains from the minimum wage?
A) Losers are all workers and gainers are all firms. B) Losers are all firms and gainers are all workers. C) Losers are all firms and some workers, while gainers are other workers. D) Gainers are some firms and all workers, while losers are some firms. E) Gainers are some firms and some workers, while losers are other firms and other workers.
The relationship between MC and AC can best be described as
A) when AC increases, MC starts to increase. B) when MC increases, AC starts to increase. C) when MC decreases, AC decreases. D) when MC exceeds AC, AC increases.
In the above figure, which wage rate will maximize union members' income?
A) W1 B) W2 C) W3 D) W3 - W1
The investment demand curve as a function of various possible interest rates for the entire economy is assumed to be:
a. positively sloped. b. negatively sloped. c. rising, then falling. d. falling, then rising.