The return to a factor that is in fixed supply is a pure rent.
Answer the following statement true (T) or false (F)
True
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The ________ the desired reserve ratio, the ________ the ________ in the quantity of money created from an initial increase of $100,000 in the monetary base
A) smaller; larger; decrease B) larger; larger; decrease C) larger; smaller; decrease D) smaller; larger; increase E) larger; larger; increase
The tables above show a nation's labor demand and labor supply schedules and its production function. Given the equilibrium in the labor market, potential GDP is
A) $3.0 trillion. B) $3.7 trillion. C) $4.2 trillion. D) $4.5 trillion. E) $2.0 trillion.
If sewing machines are considered to be a complement to labor in the production of garments, then an increase in the price of sewing machines will cause
A. the demand curve for labor to shift to the right. B. the demand curve for labor to shift to the left. C. a movement along the demand curve for labor. D. nothing to happen to the demand curve for labor.
If a person supplies fewer hours of labor in response to a wage increase, then
A) the substitution effect is greater than the income effect. B) the income effect is greater than the substitution effect. C) the income effect equals the substitution effect. D) the person is not maximizing utility.