The supply of labor is determined by the:
A. opportunity cost of hiring labor.
B. number of workers.
C. marginal product of labor.
D. All of these statements are true.
Answer: B
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Normative economics answers the question, "What ought to be?" Positive economics predicts the consequences of alternative actions, answering the questions, "What is?" or "What will be?"
Indicate whether the statement is true or false
Suppose that the marginal propensity to consume is 0.75
a. If the government decreases spending by $500 billion, what is the change in output? b. If the government decreases taxes by $500 billion, what is the change in output? c. If the government decreases transfer payments by $500 billion, what is the change in output? d. If the government decreases spending by $500 billion and at the same time decreases taxes by $500 billion, what is the change in output?
Answer the following statements true (T) or false (F)
1. The supply of money is inversely related to the level of total income and output. 2. The transactions approach to the equation of exchange can be expressed as MV = PQ. 3. The velocity of money is equal to PQ/M. 4. If M equals $40, V equals 16, and Q equals 16, then P equals $40. 5. If M triples, V remains the same, and Q doubles, then P rises.
The firm's short-run supply curve runs up the marginal cost curve
A. to the shutdown point. B. from the shutdown point all the way up the curve. C. to the break-even point. D. from the break-even point all the way up the curve.