Explain why people might work less if the wage increases.
What will be an ideal response?
This is known as the income effect of an increase in the wage rate. When the wage rate goes up, so does the real value of income for the person whose wage went up. Since the person now has more income, he or she might choose to increase the amount of leisure time that he or she consumes, if leisure is a normal good. Thus, by increasing the amount of leisure consumed, the person would decrease the amount of hours that he or she works.
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Answer the following statement true (T) or false (F)
Which of the following statements is NOT true for a perfectly competitive firm?
A) A firm's demand curve is horizontal. B) The firm can influence its demand curve by advertising its product. C) The firm's demand curve is perfectly elastic. D) The market demand and supply curves determine the market price.
_________________ banks are examined by the Office of the Comptroller of the Currency.
Fill in the blank(s) with the appropriate word(s).
A ________ is nonrival in consumption and listeners are nonexcludable.
A. concert at a local indoor arena B. satellite radio signal C. lecture in your college's auditorium D. radio signal broadcast through the air