An expenditure schedule that lies below the full employment level of GDP will cause
A. rising prices.
B. increasing output.
C. falling inventories.
D. falling prices.
Answer: D
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Refer to Scenario 2. If the age of a house increases by 1 year given that the square feet is held constant, what is the impact on the house's market value?
What will be an ideal response?
Labor hoarding occurs when
A) firms keep good workers so other firms can't hire them. B) the unemployment rate exceeds the natural rate of unemployment. C) involuntary unemployment exceeds voluntary unemployment. D) because of hiring and firing costs, firms retain workers in a recession that they would otherwise lay off.
The production function is concave in labor because
A) the contribution to production of each additional unit of labor decreases. B) the marginal product of labor is increasing. C) the marginal product of capital is decreasing. D) the labor demand is downward sloping.
An increase in the quantity of tea demanded occurs if:
A. the income of tea drinkers increases. B. the price of coffee rises. C. the price of the tea falls. D. the population of tea drinkers grows.