If labor's share of national income is to remain constant, then ________
A) the real wage must grow faster than labor productivity
B) the real wage must grow at the same rate as labor productivity
C) labor productivity must grow faster than the real wage
D) the combined growth rates of labor productivity and the real wage must equal the growth rate of national income
B
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When the supply of a good increases and the demand stays the same
A. the price of the good will rise. B. the price of the good will fall and quantity will not change. C. the price of the good will remain the same. D. the price of the good will fall and quantity will rise.
In the classical model where aggregate supply is vertical with respect to the price level, an increase (shift) in aggregate demand will yield
A. a relatively large increase in output. B. an equal change in output. C. a relatively large increase in the price level. D. a relatively small change in the price level.
If the U.S. dollar increases in value relative to other currencies, how does this affect the aggregate demand curve?
A) This will move the economy up along a stationary aggregate demand curve. B) This will move the economy down along a stationary aggregate demand curve. C) This will shift the aggregate demand curve to the left. D) This will shift the aggregate demand curve to the right.
In the figure above, if the interest rate is 6 percent
A) there is a $0.1 trillion excess quantity of money and the interest rate will rise. B) there is a $0.1 trillion excess quantity of money and the interest rate will fall. C) the money market is in equilibrium and the interest rate will remain constant. D) there is a $0.1 trillion excess demand for money and the interest rate will rise.