A firm faces competitive markets for its inputs and its output. At the profit maximizing level of output, its marginal cost is $10 and the wage paid is $2. If the MPL = L-0.5, how many workers will be hired by the firm?
A) 35
B) 40
C) 25
D) 5
C
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Assuming that the part of the government's budget used for military expenditures reduces the amount available for consumption expenditures and that the benefits to military expenditures take longer to accrue than consumption expenditures, _____
decision-makers will _____. a. democratic; be biased against military spending b. democratic; be biased in favor of military spending c. autocratic; be biased in favor of consumption d. autocratic; be biased in favor of military spending
How rapidly does the economy's self-correcting mechanism work? Most economists agree that it
a. works quickly and reliably. b. works slowly and not very reliably. c. works reliably, but not very quickly. d. does not work at all.
With an upward-sloping aggregate supply curve, tight monetary policy:
A. Reduces aggregate demand and decreases inflationary pressures. B. Reduces aggregate demand and increases inflationary pressures. C. Raises aggregate demand and increases inflationary pressures. D. Raises aggregate demand and decreases inflationary pressures.
List and describe four of the six categories of economic exchanges that are omitted from GDP calculations. Explain why these transactions are not included in GDP and give an example of each to help support your answer