Samuelson and Solow reasoned that when aggregate demand was low, unemployment was
a. high, so there was upward pressure on wages and prices.
b. high, so there was downward pressure on wages and prices.
c. low, so there was upward pressure on wages and prices.
d. low, so there was downward pressure on wages and prices.
b
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In the circular flow model, the factors of production flow in the
A) opposite direction as does the goods market. B) opposite direction as does the government. C) same direction as do the rents, wages, interest, and profits. D) opposite direction as do the rents, wages, interest, and profits. E) same direction as does the goods market.
If the nominal wage is $12 per hour and the price level (as measured by a price index) is 2, it follows that the real wage is _________ per hour
A) $24.00 B) $6.00 C) $2.50 D) $14.00. E) none of the above
A firm can sell 14 units at $18, but to sell 15 units, the firm must cut the price to $17. The marginal revenue derived from selling the 15th unit is
A. -$18. B. 0. C. $3. D. $17.
Suppose Jones sells a good for $100 at a yard sale. If the producer surplus from the sale is $75, Jones's cost of the good must have been:
A. $100. B. $175. C. $25. D. equal to the deadweight loss.