The elasticity of demand for employees is -0.50. It is also estimated that the existing minimum wage (price floor) has increased the raise the wage by 25% above equilibrium wage
How much would the employment change if the price floor was eliminated? A) Employment would decrease by 12.5%.
B) Employment would increase by 12.5%.
C) Employment would decrease by 25%.
D) Employment would increase by 25%.
B
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Which of the following statements is correct?
A. In the short run, interest rate differentials have the greatest impact on exchange rates. B. In the medium run, differences in growth rates of aggregate demand have the greatest impact on exchange rates. C. In the long run, price and inflation differentials have the greatest impact on exchange rates. D. All of the above are correct.
Countries in sub-Saharan Africa are economically disadvantaged because infectious diseases spread in these countries relatively easily. This statement reflects the:
A) geography hypothesis. B) culture hypothesis. C) location hypothesis. D) institutions hypothesis.
If the Fed makes an open market purchase of $1 million of government securities, the monetary base
A) is unchanged in size, though its composition changes. B) will decrease by a multiple of $1 million over time. C) will increase by a multiple of $1 million over time. D) is decreased by $1 million. E) is increased by $1 million.
Three firms agree to operate as a monopoly and charge the monopoly price of $80 for their product and (jointly) produce the monopoly quantity of 5,000 units. If the competitive price for the product is $40, under the Clayton Act these three firms face treble damages of ________.
A) $3,000,000 B) $1,000,000 C) $200,000 D) $600,000