Over the past 100 years, what has happened to the average workweek in the U.S. manufacturing industry? Why has this occurred? What are the implications for the size of the income and substitution effects?
What will be an ideal response?
The average workweek in manufacturing has declined from about 56 hours a week a century ago to just over 40 hours a week more recently. The primary reason for the decline in the workweek is the higher real wage. This suggests that the income effect of a permanently higher real wage dominates the substitution effect, as workers choose to have more leisure and to work fewer hours per week.
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After an extended period of steady inflation at a constant rate,
a. people will anticipate inflation. b. actual unemployment will approximate the natural rate of unemployment. c. actual unemployment will be less than the natural rate of unemployment. d. both a and b are true.
A likely example of substitute goods for most people would be
a. peanut butter and jelly. b. tennis balls and tennis rackets. c. televisions and subscriptions to cable television services. d. pencils and pens.
If the number of automobile manufacturers decreases:
A. the demand for automobiles increases. B. the demand for automobiles decreases. C. the supply of automobiles increases. D. the supply of automobiles decreases.
Refer to the information provided in Figure 33.2 below to answer the question(s) that follow.
Figure 33.2Refer to Figure 33.2. the theory of comparative advantage suggests that
A. England should export trucks and import cars. B. the United States should import cars and export trucks. C. England should export both trucks and cars. D. the United States should export both trucks and cars.