Suppose the price level increases by 5 percent and the nominal wages of workers increase by 3 percent during a particular year. This implies that the real wage has _____
Fill in the blank(s) with the appropriate word(s).
declined by 2 percent.
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The excludability versus nonexcludability issue is
A. relevant to the issue of market failure. B. not relevant to the issue of market failure. C. relevant to the free-rider problem. D. a and c E. b and c
According to Malthus, a fixed quantity of land and a growing population combined to produce:
A. accelerating economic growth. B. a stationary state in which growth ceased. C. continuous but variable economic growth. D. a stationary state in which the economy grew, but at a fixed and unchangeable rate.
Index of the average prices of goods and services throughout the economy (up when prices rise, down when prices fall)
What will be an ideal response?
Economists have long debated whether there is a significant loss of well-being to society in markets that are monopolistically competitive rather than perfectly competitive. Which of the following offers the best reason why some economists believe that
monopolistically competitive markets are less efficient than perfectly competitive markets? A) In contrast to perfectly competitive markets, neither allocative efficiency nor productive efficiency are achieved in monopolistically competitive markets. B) In contrast to perfectly competitive markets, firms in monopolistically competitive markets earn economic profits in long-run equilibrium. C) In contrast to perfectly competitive markets, firms in monopolistically competitive markets do not produce where price equals average total cost in long-run equilibrium. D) In contrast to perfectly competitive markets, firms in monopolistically competitive markets can charge a price greater than average total cost in the short run.