If demand for the product you make were to suddenly decline, you would expect the equilibrium price of the product to fall, which would lead to:
A. no change the VMP of each worker because product prices don't affect worker productivity.
B. a decrease in the marginal productivity of each worker.
C. an increase in the VMP of each worker.
D. a decrease in the VMP of each worker.
Answer: D
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Suppose you have $400 and the inflation rate is 4 percent. In order to earn a real return of $20 on your investment, the nominal interest rate must be
A) 1 percent. B) 5 percent. C) 9 percent. D) 12 percent.
When the supply (curve) of a product increases,
A) suppliers change their plans. B) demanders change their plans. C) the price changes. D) all of the above occur. E) none of the above occur.
In the above figure, if the firm is in monopolistic competition, its price will be
A) $1. B) $2. C) $3. D) $4.
Feasible WLS does not rely on the following condition:
A) the conditional variance depends on a variable which does not have to appear in the regression function. B) estimating the conditional variance function. C) the key assumptions for OLS estimation have to apply when estimating the conditional variance function. D) the conditional variance depends on a variable which appears in the regression function.