An expansionary monetary policy ________.
A. is designed to reduce aggregate demand
B. shifts the aggregate supply curve to the right
C. can reduce the length of a recession
D. is used when the inflation rate is high
Answer: C
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Using the information in the table above, calculate the employment-to-population ratio
A) 75 percent B) 65 percent C) 50 percent D) 23.2 percent
Suppose the demand for milk is relatively inelastic. What happens to sales revenue if the government imposes a price floor above the free-market equilibrium price in the market for milk?
A) Sales revenue remains unchanged. B) Sales revenue rises. C) Sales revenue falls. D) It cannot be determined without information on prices.
Total cost is equal to
a. TFC + TVC. b. TFC – TVC. c. TFC/TVC. d. TVC/TFC.
You have been hired by a data processing firm to provide economic advice. The owner of the firm tells you that the firm's only variable input is the number of data-entry operators. The hourly wage for data-entry operators is $10.00. The marginal revenue product curve for data-entry operators reaches its maximum at three workers with a marginal revenue product of $12.00. What advice would you give this firm?
A. Decrease the wage rate paid to data-entry operators so that their marginal revenue product will decrease. B. Hire three data-entry operators so as to maximize profits. C. Hire data-entry operators until the marginal revenue product is equal to the wage-which will occur when more than three operators are employed. D. Shut down immediately, as the firm is not able to cover all of its variable costs.