When the government mandates that firms supply a particular benefit, it is usually the case that
A. the wage will decrease by more than the cost of providing the benefit.
B. the wage will decrease by less than the cost of providing the benefit.
C. the wage will increase.
D. the cost of providing the benefit is less than the worker's value of the benefit.
E. employment will increase.
Answer: B
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Suppose that a firm can invest $100 today in a project and receive $105 a year from today. There is no inflation, and the annual interest rate in the economy is 6%. The firm should
A) invest in the project because the opportunity cost is greater than the return on the investment. B) not invest in the project because the opportunity cost is greater than the return on the investment. C) invest in the project because the opportunity cost is less than the return on the investment. D) invest in the project because the opportunity cost is the same as the return on the investment.
Once the copyright on a book expires
A) no publisher can claim copyright of that author's words, but the book can be reissued by any publisher. B) only the first publisher to reissue the book can claim copyright of that author's words. C) any publisher can now claim copyright of that author's words. D) no publisher can claim copyright of that author's words because the book can never be reissued.
If actual inflation is less than the expected rate of inflation, then probably
a. the borrower gains at the expense of the lender. b. neither the borrower nor the lender gains. c. the lender gains at the expense of the borrower. d. the purchasing power of the borrower is increased.
Medicare and Social Security are examples of
A) transfer payments. B) public goods. C) programs that do not respond to rational economic incentives. D) a free market system.