Consider the labor market for short-order cooks. A labor-augmenting technological change such as a faster food processor will cause
a. both equilibrium wages and equilibrium employment to increase.
b. both equilibrium wages and equilibrium employment to decrease.
c. equilibrium wages to increase and equilibrium employment to decrease.
d. equilibrium wages to decrease and equilibrium employment to increase.
a
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The figure above shows the demand and marginal revenue curves facing Sue's Surfboards, the sole renter of surfboards on Big Wave Island. If Sue is renting 25 surfboards an hour so that the marginal revenue is negative, then Sue's Surfboards
A) can increase its profit by increasing the number of rentals. B) must face an inelastic demand for surfboard rentals. C) must face a unit elastic demand for surfboard rentals. D) must face an elastic demand for surfboard rentals.
Information asymmetry is present when:
A. one person knows more than another. B. there is risk. C. when both parties are lacking the same information. D. All of these statements are true.
An example of a poverty trap is
a. extended time periods without war b. a lack of mineral wealth c. a dysfunctional or corrupt government d. laws and regulations to help detect fiscal fraud e. None of the answers is correct
Which of the following is the most likely result of a contractionary gap?
a. Market forces will increase nominal resource costs in the long run b. Short run aggregate supply will shift to the left c. Market forces will lower nominal resource costs d. Wages will increase causing wage push inflation