Public policy can reduce frictional unemployment
a. True
b. False
Indicate whether the statement is true or false
True
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When a minimum wage is ________, the firms' surplus and workers' surplus shrink, a deadweight loss ________, and resources are lost in job search
A) inefficient; arises B) inefficient; disappears C) efficient; arises D) efficient; disappears E) nonexistent; arises
Investment is a positive function of the national income level
Indicate whether the statement is true or false
Lane and Riley are the only two residents in a neighborhood, and they share the same driveway. They would like to have the driveway paved. The value of the paved driveway is $1,500 to Lane and $900 to Riley. Regardless of who pays for the paving both people will benefit from it. If the cost of paving the driveway is $2,000 and Lane proposes that they each pay 50 percent of this cost, then Riley ________ agree to Lane's proposal because ________.
A. will not; if they split the cost, then Riley's economic surplus would decrease B. will not; repaving the driveway would lower total economic surplus C. will; repaving the driveway would increase total economic surplus D. will; if they split the cost, then Riley's economic surplus would increase
Recall the Application about the effects of increasing state level Earned Income Tax Credit (EITC) on child health in the United States to answer the following question(s).Recall the Application. According to the study cited in the Application, does EITC improve income distribution?
A. Yes, aside from increasing income for low-income households, it improves the health levels of the worker and their families. B. Yes, EITC encourages workers to sop working and get an education in the health industry. C. No, only the politicians get rich because of EITC. D. No, the level of spending on EITC is so low it has no measurable effects on incomes of the poor.