According to Gordon which of the following statements about Friedman's fooling model is accurate?
A) The demand for labor depends on the nominal wage.
B) As prices increase, firms will offer higher real wages; these higher wages will bring forth an increase in the supply curve of labor.
C) The supply curve of labor depends on the expected real wage.
D) All of the above statements are accurate.
D
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The ________ rate represents the difference between the spot and forward price
A) profit B) swap C) spread D) risk
Refer to Scenario 17.5. Under which of the following payment schemes would workers have an incentive to exert high effort?
A) A guaranteed wage equal to $0 B) A guaranteed wage equal to $5000 C) A guaranteed wage equal to $10,000 D) A wage equal to the income earned, minus $4000 E) A wage equal to $0 if revenue is $5000, $2000 if revenue is $7000, and $8000 if revenue is $13,000
Which of the following is not a reason why the labor market experiences job turnover?
A. Workers differ in their abilities. B. Workers might want to change jobs after accumulating general training or education. C. Economic conditions can dictate that a firm reduce its number of workers. D. Firms differ in their amenities and working conditions. E. All of these are reasons why the labor market can experience job turnover.
As the wage rate rises, firms will respond by
A. selling more output to cover the additional costs of the labor force. B. hiring fewer workers because the labor demand curve slopes downward. C. selling the same amount of output, but passing on the higher labor costs to the customer. D. hiring more workers because a higher wage rate will make workers work harder.