The fundamental reason firms outsource is that:
A. hiring low-wage workers overseas reduces firms' costs.
B. outsourcing increases employment overseas.
C. U.S. workers cannot perform the tasks performed by workers in other countries.
D. low-wage workers in other countries are more productive than are U.S. workers.
Answer: A
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If output equals 50,000 and full employment real GDP equals 45,000, then this economy has a(n)
A. demand gap. B. employment gap. C. recessionary gap. D. inflationary gap.
If a product constitutes a large portion of a consumer’s income, demand will be more inelastic.
Answer the following statement true (T) or false (F)
Use the data in the Worked Problem on p. 287 (page 699 in Economics). Calculate the change in equilibrium expenditure when investment decreases by $150 billion
What will be an ideal response?
Productivity in the services industry may be underestimated because ____ may not be taken into account
a. the labor costs of providing a service b. the quantity of the service produced c. the capital costs of providing a service d. the prices charged by service industries e. the quality of the service provided