Which of the following would cause the labor demand curve to shift to the right?
A) a decrease in demand for the product the labor is used to produce
B) an increase in labor productivity
C) a decrease in the price of a complimentary resource
D) a decrease in output price
Answer: B
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There is $5,000,000 of currency in Econland, all held by banks as reserves. The public does not hold any currency. If the banks' desired reserve/deposit ratio is 0.25, then the money supply equals:
A. $20,000,000 B. $10,000,000 C. $6,250,000 D. $5,000,000
Which of the following correctly identifies characteristics of land and capital?
A) Land and capital can both be rented and owned. B) Land is rented, whereas capital is owned. C) Land can be owned or rented, whereas capital can only be owned by a firm. D) Capital can be owned or rented by a firm, whereas land can only be owned by a firm.
Which of the following is not an example of inflation causing a redistribution of income because the inflation was unanticipated?
A) Firms have to hire an extra worker to change prices in its store because of inflation. B) A worker receives a raise in salary that is less than the rate of inflation, because management under-predicted inflation. C) A bank collects a lower amount of interest from a loan because inflation was under-predicted. D) A firm signs a 3-year contract with a union based on a 2 percent anticipated rate of inflation per year, and the actual rate of inflation ends up being 7 percent per year.
The multiplier is defined as the ratio of a change in income to the
A) marginal propensity to save. B) marginal propensity to consume. C) change in the marginal propensity to consume causing it. D) change in the marginal propensity to save causing it. E) change in planned autonomous spending causing it.