A firm's demand for labor is derived from the:
A. opportunity costs associated with labor and leisure.
B. demand for its output.
C. desires and needs of the entrepreneur.
D. cost of labor inputs.
Answer: B
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The Fed conducts an open market operation and buys $50,000 of government securities from Commerce Bank. The desired reserve ratio is 25 percent. What is the change in Commerce Bank's total reserves and its excess reserves?
What will be an ideal response?
Why don't some firms in monopolistic competition earn losses in the long run?
A) The firms have enough monopoly power to ensure they always earn profits. B) Free entry allows enough firms to remain in the market and maintain the critical mass of firms required to attract customers. C) Free exit implies that any unprofitable firms leave the market in the long run. D) In the long run, firms will build enough brand loyalty among customers to ensure a profitable level of sales.
In 2010 President Obama proposed more generous tax write-offs for businesses that invest in additional equipment in order to stimulate investment spending
a. True b. False Indicate whether the statement is true or false
Other things equal, when the supply of workers is low, one would predict that market wages would be
a. relatively high. b. relatively low. c. determined solely by factors that affect demand. d. determined outside the domain of economic theory.