As the result of a decrease in capital, the demand for labor would ________, the supply of labor would ________, and the real wage would ________
A) decrease; decrease; decrease B) decrease; remain the same; increase
C) decrease; remain the same; decrease D) decrease; increase; remain the same
C
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Suppose that after specializing according to comparative advantage, a country is trading with another nation that also specializes according to its comparative advantage. Which of the following statements are true for the first country?
i. It enjoys gains from trade. ii. It must have an absolute advantage in the production of the good it produces. iii. It is producing at a point beyond its PPF. A) ii and iii B) i and iii C) i, ii, and iii D) i only E) i and ii
Derive the budget line equation for the case where good 2 is a composite good. What is the vertical intercept and what is the slope?
What will be an ideal response?
In principle, taxes and cap-and-trade plans will have exactly the same effects
Indicate whether the statement is true or false
How does a laissez-faire economy decide which consumer gets each of the goods that has been produced?