Suppose new electronic devices make it easier to monitor the effort levels of workers. If some shirking is still possible in the efficiency wage model, what happens to the efficiency wage?
A) Declines, but remains above the market-clearing wage
B) Declines, and falls below the market-clearing wage
C) Increases
D) Does not change
A
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Public goods are distinguished by two primary characteristics. What are they?
A) nonrivalry and nonexcludability B) market failure and high prices C) government intervention and low prices D) rivalry and exclusivity
Everything else held constant, abolishing the individual income tax will
A) increase the interest rate on corporate bonds. B) reduce the interest rate on municipal bonds. C) increase the interest rate on municipal bonds. D) increase the interest rate on Treasury bonds.
If the efficient markets hypothesis is correct, then
a. the number of shares of stock offered for sale exceeds the number of shares of stock that people want to buy. b. the stock market is informationally efficient. c. stock prices never follow a random walk. d. All of the above are correct.
Refer to the information. If the per-unit price of raw materials rises from $4 to $8 and all else remains constant, the per-unit cost of production will rise by about:
Answer the question on the basis of the following information. An economy is employing 2 units of capital, 5 units of raw materials, and 8 units of labor to produce its total output of 640 units. Each unit of capital costs $10; each unit of raw materials, $4; and each unit of labor, $3. A. 100 percent. B. 50 percent. C. 40 percent. D. 30 percent.