When the real wage is above the level that equilibrates supply and demand, then the quantity of labour supplied:
A. depends on the nominal wage.
B. is smaller than the quantity of labour demanded.
C. is equal to the quantity of labour demanded.
D. is greater than the quantity of labour demanded.
Ans: D. is greater than the quantity of labour demanded.
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People sometimes worry that American trade with other countries will lead to large U.S. trade deficits and the movement of massive amounts of American capital out of the country. This worry is unfounded because countries cannot
A) increase savings at the same time that a trade deficit grows. B) spend more than they earn. C) invest more than they save. D) have both current account and financial account deficits at the same time. E) increase their trade with other countries without increasing their savings.
The equilibrium compensating wage differential between two occupations in the same city is $10 per hour. Both occupations have equivalent training requirements. Shannon works in the higher-paying occupation and would have been willing to do so even if the compensating differential was $5 per hour. Therefore,
a. Shannon will migrate to the lower-paying occupation b. Shannon must have a greater distaste than the typical worker for the nonmonetary characteristics of her occupation c. the equilibrium compensating wage differential is more than enough to prevent Shannon from moving to the other job d. the higher-paying occupation cannot have a perfectly competitive labor market e. Shannon must have a greater preference than the typical worker for the lower- paying occupation
What are instantaneously consumed as they are being produced?
a. gifts b. services c. intermediate goods d. durable goods e. basic goods
John Maynard Keynes
A. agreed with classical writers that strong automatic pressures drive market economies to full employment. B. focused on attaining the long-run macroeconomic goal of high, but stable economic growth. C. argued that a market economy might become stuck in a short-run equilibrium in which substantial capital and labor lay idle. D. argued that short-run equilibrium occurs only at full employment.