As the wage rate rises to extremely high levels, the ____________ becomes stronger than the ____________.
A. income effect; substitution effect
B. substitution effect; income effect
C. marginal revenue product; resource demand
D. None of these choices are correct.
A. income effect; substitution effect
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The best measure of the average standard of living is:
a. yearly population increase. b. real GDP per capita. c. consumer credit balances. d. the overall level of investment.
Characteristics of the "invisible hand" concept include all of the following, except
A. Simple markets. B. Individuals and firms pursue their own self-interest without any central direction or regulation. C. A complete lack of government involvement in the economy. D. All of the choices are characteristics of the "invisible-hand."
US law was recently changed so that some airplane manufacturers are immune from liability from accidents involving their decades old aircraft. As a result
a. accident rates fell due to less adverse selection b. accident rates fell due to less moral hazard c. accident rates rose due to less adverse selection d. accident rates rose due to less moral hazard
_____________ can play a useful role in passing rules on how businesses operate, but these well-intentioned laws can, in some cases, become so intrusive that businesses decide to place limits on their hiring.
a. People b. Cities c. Government d. The World Trade Organization