A competitive employer is using labor in such an amount that labor's MRP is $10 and its wage rate is $8. This firm:
A. should hire more labor because this will increase profits.
B. should hire more labor, although this may either increase or decrease profits.
C. is currently hiring the profit-maximizing amount of labor.
D. is selling its product in an imperfectly competitive market.
Answer: A
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A decrease in the marginal tax rate, with the average tax rate held constant, will
A) increase the amount of labor supplied at any real wage. B) not affect the amount of labor supplied at any real wage. C) decrease the amount of labor supplied at any real wage. D) increase the amount of labor supplied at any real wage if the average tax rate is above the marginal tax rate, but decrease the amount of labor supplied at any real wage if the average tax rate is below the marginal tax rate.
The Federal Reserve Board of Governors consists of
a. 50 members selected by state legislatures b. 12 members, one from each Federal Reserve District c. 12 members nominated by the President and confirmed by the Senate d. seven members elected by Congress e. seven members nominated by the President and confirmed by the Senate
Which of the following factors will reduce considerably the ability of a union to raise the wages of its workers?
a. an elastic demand for the goods produced by union labor b. a five-year apprenticeship before one can qualify for jobs held by union members c. high tariffs on goods produced by the union labor d. favoritism in the allocation of government contracts to firms that employ union labor
If the United States is experiencing inflation, then it will be most willing to engage in international policy coordination that requires:
A. expansionary U.S. monetary policy. B. strengthening the dollar. C. weakening the dollar. D. expansionary U.S. fiscal policy.