Suppose that many corporations begin issuing new bonds. Everything else being equal, what is most likely to happen to the interest rate?
A. It will increase.
B. It will decrease.
C. It will not change.
D. It will vary according to a random walk.
Answer: A
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If the marginal product of labor is less than the nominal wage divided by the price of output, a firm that wishes to maximize profits will
A) hire more labor. B) lay off workers. C) maintain its current level of workers. D) raise the real wage.
Merit pay for teachers has a _________ on test student test scores.
A. positive B. negative C. undetermined D. none of these answer options are correct.
Producers of close substitutes have little or no incentive to merge.
Answer the following statement true (T) or false (F)
Basic supply and demand analysis indicates that having firms rather than the government provide health insurance to workers
A) changes both the composition of the compensation that firms pay and its level. B) changes the composition of the compensation that firms pay, but does not change its level. C) does not change the composition of the compensation that firms pay, but does change its level. D) changes neither the composition of the compensation that firms pay nor its level.