Which of the following best states the relationship between machinery and the earnings of labor?
a. Production of machinery creates jobs, thereby increasing the demand for (and wages of) labor.
b. Output and real earnings can always be increased whenever a machine can be substituted for a function previously performed by labor.
c. Machines tend to reduce the demand for labor, thereby reducing the earnings rate of labor.
d. High productivity per worker hour is a necessary ingredient for the attainment of high real earnings, and adoption of labor-saving machinery enhances the ability of labor to attain such high productivity.
d. High productivity per worker hour is a necessary ingredient for the attainment of high real earnings, and adoption of labor-saving machinery enhances the ability of labor to attain such high productivity.
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Refer to Cost of Production. The short-run total cost of producing 50 units of output per week is $180, but the long-run total cost is
The following questions refer to the diagram below. The wage rate is assumed to be $12 per hour, the rental rate is assumed to be $6 per hour, and capital is assumed to be fixed in the short run at 10 hours.
a. $180.
b. $270.
c. $300.
d. $900.
Black market transactions generally increase the deadweight losses created by restrictive government policies
Indicate whether the statement is true or false
Suppose the firms in a monopolistically competitive market are incurring economic losses. What will happen to move the market to its long-run equilibrium?
A) More close substitutes will appear in the market until economic profits are zero. B) The firms that dropped out of the market will reenter once the level of economic losses is zero. C) Firms will continue to exit the market until economic losses are equal to zero. D) The demand functions of all the firms remaining in the market will become relatively more elastic.
Which one of the following items would be the most liquid?
a. Pizza. b. Ticket to next week's basketball game. c. Stereo. d. Dollar bill. e. U.S. savings bond.