Which of the following statements is true?
A) If the nominal wage rate increases, the opportunity cost of current consumption decreases.
B) If the unemployment rate increases, the opportunity cost of current consumption decreases.
C) If the real interest rate increases, the opportunity cost of current consumption increases.
D) If the real wage rate increases, the opportunity cost of current consumption decreases.
C
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Refer to Labor Demand and Labor Supply. What does area A + B + C represent?
The following questions refer to the accompanying diagram, which shows an industry's labor demand and labor supply. Labor and capital are the only factors used by the industry. The industry hires L units of labor at a wage of PL.
a. The industry's total revenue.
b. The rent earned by the industry's laborers.
c. The total wages paid to the industry's laborers.
d. The rent earned by the industry's capital.
The deadweight loss that arises from a monopoly is a consequence of the fact that the monopoly
a. quantity is lower than the socially-optimal quantity. b. price equals marginal revenue. c. price is the same as average revenue. d. earns positive profits.
An increase in the value of the dollar will __________ exports and __________ imports.
Fill in the blank(s) with the appropriate word(s).
You own a business that answers telephone calls for physicians after their offices close. You have an incentive to substitute capital for labor if the
A. price of labor decreases. B. marginal product of labor increases. C. price of capital decreases. D. price of capital increases.