Which of the following types of wages is set by the labor market, assuming no interference from external sources?
a. equilibrium wage
b. efficiency wage
c. minimum wage
d. union wage
a. equilibrium wage
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Most goods and service that we enjoy are bought and sold in the market. However, leisure is something that we value but we do not buy it explicitly
What is the price of leisure? Explain what would happen to the amount of leisure that we would enjoy if the wage rate went up. Make sure to use the substitution and income effect to explain your answer and postulate whether leisure is a normal or inferior good. Why is the ultimate net effect not determinable by appealing to logic alone?
In order to compute national income from GDP,
a. national income is first calculated, and then depreciation of capital and indirect business taxes are subtracted from it to get GDP. b. GDP is first calculated, and then gross private domestic investment is subtracted from it to get national income. c. GDP is first calculated, and then capital depreciation and proprietors' income are subtracted from it to get national income. d. GDP is first calculated, and then depreciation of capital is subtracted from it to get national income.
The cheapest way to produce a certain amount of output may vary between the short and long-run because:
a. all inputs can be adjusted in the long run. b. all inputs can be adjusted in the short run. c. input prices are fixed in the short run. d. prices increase over the long-run.
A country possesses a comparative advantage in the production of a product if
A) the opportunity cost, in terms of the amount of other products that it gives up to produce this product, is lower than it is for its trading partners. B) it possesses an absolute advantage in the production of this good compared to its trading partners. C) it is able to produce less of this good per worker than its trading partners. D) it can produce more of this good per hour than its trading partners.