The substitution effect of a wage rate increase suggests that
A. individuals will supply more labor.
B. individuals will supply more work and consume more leisure.
C. individuals will supply less labor.
D. individuals will consume more leisure.
Answer: A
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The commodity substitution bias is that
A) consumers substitute high-quality goods for low-quality goods. B) government spending is a good substitute for investment expenditures. C) national saving and foreign borrowing are interchangeable. D) consumers decrease the quantity they buy of goods whose relative prices rise and increase the quantity of goods whose relative price falls.
The figure above shows the demand and supply of dollars in the foreign exchange market. The equilibrium in the market occurs at a price of ________ Brazilian reals per dollar and a quantity of ________ billion dollars
A) 2.0; 100 B) 2.4; 120 C) 1.6; 100 D) 100; 2.0
In the above figure, the range of unit elasticity occurs
A) on the vertical axis. B) on the horizontal axis. C) between point c and point d. D) below point e.
A rise in the federal funds rate _________ reserves and _________ the quantity of deposits and bank loans created.
Fill in the blank(s) with the appropriate word(s).