The income effect of a real wage increase is observed when
A) the higher wage causes workers to take more leisure and work fewer hours.
B) the higher wage causes workers to take less leisure and work more hours.
C) leisure's higher opportunity cost causes workers to take less leisure and work more hours.
D) leisure's higher opportunity cost causes workers to take more leisure and work more hours.
A
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A point lying inside (under) a production possibilities frontier indicates that
A. the economy is saving money. B. there are no associated opportunity costs. C. more output could be produced with existing resources. D. technology limits production.
According to the Solow model, given the levels of total efficiency units of labor and technology:
A) efficiency units of labor do not play any role in the determination of steady-state equilibrium level of GDP. B) there is a maximum fixed level of GDP that an economy can achieve by increasing savings. C) increases in the savings rate is the sole reason for sustained economic growth. D) increases in the rate of physical capital accumulation can be the sole reason for sustained economic growth.
Consider the market for leather shoes. If producers believe the price of leather shoes will increase next month, today
A) the supply curve for leather shoes shifts rightward. B) the supply curve for leather shoes shifts leftward. C) there is a movement along the supply curve for leather shoes. D) the equilibrium price of leather shoes falls. E) the equilibrium quantity of leather shoes increases.
An HVAC company is selling heating and cooling equipment. Between its sales staff and the VP of Marketing, the sales staff would want to
a. Price aggressively to ensure sales are made b. Price less aggressively to ensure that profitable sales are made c. Price at cost to minimize sales d. None of the above