A winter ice storm has paralyzed the entire east coast, reducing productivity sharply. This supply shock shifts the marginal product of labor curve
A) up and to the right, raising the quantity of labor demanded at any given real wage.
B) down and to the left, reducing the quantity of labor demanded at any given real wage.
C) up and to the right, reducing the quantity of labor demanded at any given real wage.
D) down and to the left, raising the quantity of labor demanded at any given real wage.
B
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Refer to Figure 24-2. Ceteris paribus, an increase in the price level would be represented by a movement from
A) SRAS1 to SRAS2. B) SRAS2 to SRAS1. C) point A to point B. D) point B to point A.
A profit-maximizing firm should spend an additional dollar on advertising so long as this expenditure results in more than one dollar of:
a. additional sales. b. reduced costs. c. increased profits. d. demand.
A reserve requirement of 10% implies a money multiplier of 10 and a reserve requirement of 15% implies a money multiplier of 15
a. True b. False Indicate whether the statement is true or false
In an economy with flexible exchange rates, which measure(s) are successful at reducing unemployment in the context of the Three-Sector-Model?
a. Decrease government spending. b. Lower the discount rate for banks. c. Raise tax rates. d. Increase reserve requirements. e. All of the above