Suppose a study showed that as the income of doctors increased, doctors spent more time on the golf course and less in the office. What would such a conclusion say about the relative sizes of substitution and income effects?
The supply curve for doctor labor hours is bending backward with respect to wage. This means the income effect (as income rises, buy more leisure) outweighs the substitution effect (as wages rise, choose more work and less leisure).
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The quantity of labor supplied is determined by the:
A. number of firms. B. opportunity cost of providing labor. C. marginal product of labor. D. technology.
A demand curve:
a. has a positive slope. b. illustrates the negative relationship between price and quantity demanded. c. illustrates the positive relationship between price and quantity demanded. d. is based on the assumption of a stable supply curve. e. shifts about in a random fashion.
Approximately what percentage of local government expenditures goes to finance education?
A. 36. B. 44. C. 53. D. 69.
If the U.S. interest rate, adjusted for people's expectation of inflation, increases sharply relative to the rest of the world, then
A) there will be a decrease in the demand for dollars in foreign exchange markets. B) there will be no change in the demand for dollars in foreign exchange markets but there will be an increase in demand for foreign currency. C) the dollar will appreciate. D) the dollar will depreciate.