If there is a floor on wages created by a minimum wage, union contracts, or other factors, then a decline in the marginal productivity of low-skilled workers will ________ the demand for low-skilled workers and ________ the number of unemployed workers.
A. increase; increase
B. decrease; decrease
C. increase; decrease
D. decrease; increase
Answer: D
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The concerns about world food production raised by Malthus have not materialized because:
A) input prices have fallen over time. B) crop prices have risen over time. C) Malthus was wrong about the diminishing returns to labor in agriculture. D) technological improvements have increased our ability to produce food over time.
The production possibilities frontier shows the feasible combinations of production without waste.
Answer the following statement true (T) or false (F)
The correct measure of the deficit is also called
A) the cyclically-adjusted deficit. B) the structural deficit. C) the full-employment deficit. D) the inflation-adjusted deficit. E) all of the above
If a bond dealer sells a government bond to the Fed for $100,000, and the reserve ratio is 10 percent, then the bank that receives a $100,000 deposit from the dealer can expand its loans by ________, and the money supply can increase by as much as ________.
A. $90,000; $900,000 B. $80,000; $800,000 C. $90,000; $1,000,000 D. $10,000; $100,000