The supply curve for high-skilled labor lies to the
A) right of the supply curve for low-skilled labor because more people want a high-skilled job.
B) left of the supply curve for low-skilled labor because more people want a high-skilled job.
C) left of the supply curve for low-skilled labor because it is costly to acquire skills.
D) right of the supply curve for low-skilled labor because fewer high-skilled people are willing to work for a low wage.
C
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The water and diamonds paradox of value
A) is that water is essential for life and yet is cheap, whereas diamonds are totally nonessential and yet are expensive. B) points out that we generally have a low total utility of water and a high total utility of diamonds. C) is resolved by the principle that market price is determined by total utility, not marginal utility. D) none of the above
Causation and Correlation are generally the same thing.
A. True B. False C. Uncertain
Explain why perfectly competitive markets achieve allocative efficiency.
What will be an ideal response?
The overriding factor in analyzing long-run changes in the exchange rate is:
a. the exchange rate in the period t- 1. b. how a permanent change in the supply of money is transmitted to prices and interest rates. c. the reaction of traders as they conduct arbitrage and speculation. d. the notion that there is no long run, only a series of short-run measurements.