The Secretary of Labor states that wage rates in the country have risen by 2 percent this past year. The head of a local labor union states that wage gains have not kept pace with the 3 percent rate of inflation. The Secretary's statement is a ___________ economic statement, and the labor head's statement is a(n) _____________ economic statement
a. normative; normative
b. normative; positive
c. positive; normative
d. positive; positive
e. proper; improper
D
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The difference between the Keynesian and classical labor supply functions is that in the Keynesian version
a. workers know the real wage while in the classical system workers must form an expectation of the price level. b. workers must form an expectation of the price level while the workers know the real wage in the classical system. c. workers are assumed to be interested in the money wage while in the classical version workers know the real wage. d. labor supply depends on the actual real wage while labor supply depends on the expected real wage in the classical system.
An individual owns a $100,000 home. She determines that her chances of suffering a fire in any given year to be 1/1000 (0.001). She correctly calculates her expected loss in any year to be $100. Explain why this really isn't a good way to measure her potential for loss.
What will be an ideal response?
Suppose a monopsonist hires its second worker and this hiring has a marginal factor cost of $75 per day. If the market wage is now $62.50 per day, what was the first employee earning when she worked alone?
A. $40. B. $45. C. $50. D. $55.
Suppose that the income elasticity of demand for peanut butter is 0.75. Which of the following is TRUE?
A. Peanut butter is an inferior good, because income elasticity is positive. B. Peanut butter is a normal good, because income elasticity is less than 1. C. Peanut butter is an inferior good, because income elasticity is less than 1. D. Peanut butter is a normal good, because income elasticity is positive.