In each of the following scenarios, state whether the labor supply curve would shift to the left, to the right, not shift at all, or if the shift is ambiguous because there is more than one effect and they would move the curve in opposite directions.(a)The stock market rises sharply.(b)Fewer teenagers work while in school than before.(c)A large fraction of the population flees the country because of a bird flu epidemic.(d)The expected future wage declines and the stock market crashes.(e)The current real wage rate rises.
What will be an ideal response?
| (a) | Higher wealth shifts the labor supply curve left. |
| (b) | Lower participation rate shifts the labor supply curve left. |
| (c) | Smaller working-age population shifts the labor supply curve left. |
| (d) | The lower future wage shifts the labor supply curve to the right and the stock market crash |
| (e) | No effect; just a movement along the curve. |
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The medium of exchange is defined as
A) an object that is accepted in return for goods and services. B) the exchange of goods and services directly for goods and services. C) an item that can be stored and hold its value over time. D) credit cards. E) barter.
A firm that is a price taker faces
A) an elastic supply curve. B) an inelastic supply curve. C) a perfectly elastic demand curve. D) a perfectly inelastic demand curve. E) an elastic but not perfectly elastic demand curve.
If exports are less than imports (while other planned injections equal other planned leakages), the economy
a. expands. b. contracts. c. has rising prices. d. remains stable.
A level of insurance is said to be actuarially fair when in which of the following situations?
a. Premiums that someone pays are less than the amount that an average person in that risk group would collect in insurance payments. b. Everyone in a risk group pays the same amount regardless of insurance payments collected. c. Premiums that someone pays are equal to the amount that an average person in that risk group would collect in insurance payments. d. Everyone in a risk group pays more than the average person in that risk group would collect in insurance payments.