Let M = 36, k = 3, Ls = W/P, MPN = L-1/2 and Y = 2L1/2 . Calculate the labor demand curve, the aggregate demand curve, and the equilibrium values of the real wage, labor, output, and the price level
What will be an ideal response?
Setting the real wage equal to the marginal product of labor allows you to solve for the labor demand curve as Ld = (W/P)-2 . Setting this equal to labor supply allows you to solve for the equilibrium value of labor and the real wage, L = 1 and W/P = 1 . Plugging these values into the production function gives you Y=2 . Plugging all of these values into the quantity theory equation allows you to solve for the equilibrium price level, P = 6.
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When the slope of the total product curve is steep, the marginal product is
A) zero. B) negative. C) high. D) low. E) not defined.
Continuing with the same vacation-insurance company from the preceding question, what vacation-day price(s) would be acceptable to both the family and the insurance company?
a. 2 only b. 3 only c. 2 or 3 d. 4
CEO is an abbreviation for
a. corporate executive organization b. category of endless output c. chief executive officer d. common efficient output e. corporate extra operation
"Per capita GDP" tells us ________.
the average income (or output) of a country per person the amount of GDP adjusted for inflation the amount of GDP at the natural rate of unemployment the amount of GDP for a specific state