The effect of legislation establishing a minimum wage above the market clearing wage is
A. a shift of the demand for labor curve.
B. higher wages for all workers.
C. unemployment.
D. a shortage of labor.
Answer: C
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The change in total cost that results from the production of one additional unit is called:
a. marginal revenue. b. average variable cost. c. marginal cost. d. average total cost.
Which of the following will not cause the aggregate demand curve to shift?
a. an increase in government spending for interstate highways b. an increase in the sales of exports resulting from a change in the exchange rate c. a change in the price level d. an increase in the purchase of capital goods caused by a change in expectations e. a decrease in the construction of new houses caused by an increase in interest rates
Rainbow trout has the shortest fishing season, which causes a rapid decrease in its population. To prevent the extinction of the trout, the government initially imposed a quota on the total amount of fish caught. The quota was imposed on the fishing of rainbow trout to prevent _____
a. the free rider problem b. the tragedy of the commons c. asymmetric information d. deadweight loss
With flexible exchange rates
A. The balance of trade is zero. B. All countries will run either a trade surplus or trade deficit. C. The equilibrium exchange rate is determined in a foreign exchange market. D. Foreign exchange reserves are used to offset balance-of-payment deficits.