Matt is offered a job driving the campus shuttle bus from 4 p.m. to 6 p.m. each Monday. His reservation wage for this job is $7 per hour. Now suppose the director offers Matt $50 per hour, but also announces that the earnings from the job will be divided equally among Matt and four other students. Will Matt accept this job?
A. Yes, because $50 divided by five is greater than Matt's reservation wage.
B. No, because it is not fair for Matt to do the work and then have to share the wage.
C. No, because the other students are free riders.
D. Yes, because Matt believes in the Rawlsian theory of justice.
Answer: A
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In an open economy under flexible exchange rates, a reduction in the interest rate will cause a reduction in which of the following?
A) investment B) the exchange rate, E C) net exports D) all of the above E) none of the above
Suppose that airline workers are laid off during a recession because of an unspoken agreement between airline workers and airline executives that wages will not be reduced. This example is consistent with the
A. implicit contract explanation of unemployment. B. explicit contract explanation of unemployment. C. efficiency wage explanation of unemployment. D. relative-wage explanation of unemployment.
Henry deposits $2,000 in currency in the First Street Bank. Later that same day Jane Harris negotiates a loan for $5,400 at the same bank. After these transactions, the supply of money has:
A. Increased by $2,100 B. Increased by $3,300 C. Increased by $5,400 D. Decreased by $3,300
Refer to the information provided in Figure 7.4 below to answer the question(s) that follow. 
Figure 7.4Refer to Figure 7.4. The average product with five workers is
A. 1. B. 2.5. C. 5. D. 11.