Two factors are affecting the domestic auto industry: (1) an increase in cheap Korean imports (2) an increase in the cost of materials. What can we say about equilibrium price and quantity of domestic autos?
A. Equilibrium price will fall.
B. Equilibrium quantity will fall.
C. Equilibrium price will rise.
D. The answer cannot be determined from the information given above.
Answer: B
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According to the text, which of the following factors contributed to the increased labor force participation rate of women during the postwar period?
a. rising real wages b. an increase in the years of schooling completed by women c. declining fertility rates d. the growth of the service sector e. All of the above
When wages are set by contract, inflation
a. reduces real wages; this likely makes labor markets more flexible. b. reduces real wages; this likely makes labor markets less flexible. c. raises real wages; this likely makes labor markets more flexible. d. raises real wages; this likely makes labor markets less flexible.
A currency depreciation would _____ net exports, and therefore ___________ aggregate demand.
A. increase; increase B. increase; decrease C. decrease; decrease D. None of the above is correct.
If the equilibrium wage in the market for unskilled labor is $8.00 per hour, and the government sets a minimum wage at $7.50 per hour, unskilled workers will receive a pay cut of about 50 cents per hour.
Answer the following statement true (T) or false (F)