Based on the graph showing the effects of a government budget surplus, when a surplus makes the loanable funds supply shift from S1 to S2, the real interest rate will ______.
a. remain at r1
b. remain at r2
c. rise from r2 to r1
d. drop from r1 to r2
d. drop from r1 to r2
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As wages rise, the substitution effect induces households to
A) choose leisure rather than supplying labor in the labor market. B) choose supplying labor in the labor market rather than engage in leisure. C) reduce the opportunity cost of leisure. D) reduce the economic rent from leisure.
The demand for lumber is particularly derived from the demand for
a. housing b. carpenters c. lawn services d. farmland e. dollhouses
As the price level rises
a. people will want to buy more bonds, so the interest rate rises. b. people will want to buy fewer bonds, so the interest rate falls. c. people will want to buy more bonds, so the interest rate falls. d. people will want to buy fewer bonds, so the interest rate rises.
A firm will hire a unit of input only if its
A. marginal physical product and marginal revenue product are positive. B. marginal physical product and marginal revenue product are negative. C. marginal physical product is positive and whose marginal revenue product is negative. D. marginal physical product is negative and whose marginal revenue product is positive.