If a major league baseball player would be willing to work for $700,000 per year and is currently being paid $1,200,000 per year, that player is earning an annual economic rent of
A) $700,000.
B) $1,900,000.
C) $1,200,000.
D) $500,000.
Answer: D
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Refer to Scenario 1-2. Had the firm not produced and sold the last 300 hats, would its profit be higher or lower, and by how much?
A) Its profit will be $1,000 lower. B) Its profit will be $100 lower. C) Its profit will be $1,100 higher. D) Its profit will be $100 higher.
Briefly describe how competition may reduce discrimination. Give an example.
What will be an ideal response?
In a certain economy, the components of aggregate spending are given by: C = 500 + 0.8(Y - T) - 300rI = 200 - 400rG = 200NX = 10T = 150Given the information about the economy above, what would be the impact on aggregate expenditures of a one-percentage-point increase in the real interest rate (r)?
A. Aggregate expenditures would decrease by 35 units. B. Aggregate expenditures would decrease by 7 units. C. Aggregate expenditures would increase by 35 units. D. Aggregate expenditures would decrease by 700 units.
Falling output, in the short run, could be due to:
A. an increase in short-run aggregate supply. B. a reduction in aggregate demand. C. an increase in long-run aggregate supply. D. an increase in aggregate demand.