Which theory states that education is correlated with natural ability?
signaling theory
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If expectations are formed rationally and wages are inflexible in the short run, the short-run aggregate supply curve is
A) upward sloping. B) horizontal. C) vertical. D) relatively flat.
Vertical integration can reduce transaction costs through all of the following ways except which one?
A) decreasing the incentive for litigation B) creating managerial diseconomies C) establishing a partnership between the two firms D) increasing information and control
During the course of a week, McDonald's has enough time to hire or layoff workers, but it does not have enough time to expand its kitchen or add an additional seating area. In this situation, McDonald's:
a. has no fixed costs. b. is in the short run. c. suffers an economic loss. d. earns a large profit.
Suppose the foreign exchange market is in equilibrium and that the interest rate in Russia increases. How would the foreign exchange market be affected?
a. The supply of Russian rubles will decrease. b. The demand for Russian rubles will decrease. c. The Russian interest rate has no effect on the market. d. The supply of Russian rubles will increase. e. The demand for Russian rubles will increase.